The Hindu Business Line : `More investments in farm, infrastructure sectors needed'

THE Indian economy, which is poised to cross the expected seven per cent growth in GDP this year, will be able to sustain the growth only if sufficient investment is made in the areas of agriculture and infrastructure, according to Mr Mahendra K. Sanghi, President, Assocham.

He was talking to presspersons here on the eve of an Assocham conference on corporate governance.

Pointing out to several positive trends in the economy, he said that industrial sectors such as cotton textiles, basic chemicals, petroleum products, and machinery and transport equipment are posting a double-digit growth at present. The investment climate has improved significantly as reflected in the stock market boom. He strongly recommended further liberalisation of FDI activity stating that huge investments cannot come from disinvestment alone. "In this context it is heartening to note that FDI has increased from $2.2 billion in 2003-04 to $3.3 billion in 2004-05," he said.

Mr Sanghi said that it was a matter of concern that the agri sector, which contributes to 22 per cent of the country's GDP, lacks fresh investment activity. He also pointed out that existing infrastructure bottlenecks in power, ports and roads should be removed to encourage sustained growth of the economy. Mr Sanghi also pointed to the lack of infrastructure in Bangalore and how the city was going through the pains of unplanned and inadequate management of urban infrastructure.

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