The Hindu Business Line : Jalan hopeful of 6.5 pc growth

THE Reserve Bank of India Governor, Dr Bimal Jalan, has said that the economy could register a growth of six to 6.5 per cent for 2002-03 on the back of a good monsoon, well in line with the projections made by the central bank earlier.

He told newspersons after a meeting with the Finance Minister, Mr Yashwant Sinha, here on Thursday that the fundamentals of the economy were strong, including the external sector.

There was no cause for worry on account of the escalation of tension on the border. "There is nothing to worry," he said.

On the prospects of a bank rate cut from the prevailing rate of 6.5 per cent, Dr Jalan was non-committal.

The RBI Governor said that the cut would hinge on liquidity conditions, which he felt were satisfactory at the moment.

"If liquidity conditions change in such a way that a bank rate cut is called for, then there will be such a cut. The idea is that it has to be in a way that it is sustainable."

Dr Jalan said that as long as inflation was low, the policy of soft interest rate would continue.

There was no problem in carrying out the Government's borrowing programme, he added.

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