Himalayan News Service

New Delhi, March 1:

That India is one of the fastest growing economies in the world was underlined yet again when finance minister P Chidambaram presented his annual budget for the financial year beginning from April 1 in parliament yesterday. The budget for 2005-06 has assumed that the economy of the second most populous nation on the planet would grow at an impressive rate of between seven per cent and eight per cent in real terms with inflation contained at four-five per cent. This assumption is not particularly unrealistic considering the fact that India’s gross domestic product (GDP) increased by as much as 8.5 per cent during 2002-03 after registering a poor four per cent growth in the previous year, largely on account of a severe drought that saw farm output falling. However, an erratic monsoon together with the sudden jump in international prices of crude sent inflation soaring to a high 8.7 per cent in August. Uncertain rainfall and high prices resulted in business confidence getting muted.