Manipal, May 26: The growth performance of economies in Asia in the short to medium-term is crucial to fast recovery from the present global slump, Finance Minister Pranab Mukherjee said today.
In augurating a national seminar on “21st century as the Asian Century - Role of India and China” here, he said India's growth in 2011-12 is estimated to have slowed to 6.9 per cent.
IMF expects growth in Asia Pacific region to gain momentum in 2012, with a growth projection of six per cent in 2012 and 6.5 per cent in 2013.
In the long term, a key advantage that Asian economies, prominently India and China possess is high rates of savings and investment.
India's resilience, Mukherjee said, results from the fact that the bulk of India's GDP is driven by domestic demand.
India's banking sector is robust and the export is increasingly getting diversified with developing countries being our largest export market, he said.
“Our regulatory mechanisms have been successful in ensuring financial sector robustness in the economy. China's policy too has started emphasising a growth strategy that is more dependent on domestic demand”, he noted.
Asian economies in general have evolved to be attractive destinations for Foreign Direct Investment, which is aiding innovation in their economies, Pranab said. Going forward, GDP growth in many developing nations must be accompanied by measures aimed at fulfilling the aspirations of the young population just as social security compulsions would assume prominence in ageing societies, Pranab said.
“We must appreciate that to gain in unison, we must act in unison. Even in the existing international fora, including the G-20 and the IMF, we should aim to coordinate more in areas where there is significant collective gain to be achieved”, he said.
“A crisis of the magnitude that we are witnessing compels us to take notice of our deficiencies, suitably re-orient policies and re-define priorities,” he said.
There is world wide recognition of the fact that most Asian economies, including India, are poised to attract long-term growth, despite some short-term challenges, Pranab said.
