India capable of 10 p.c growth: Manmohan

NEW DELHI, Wednesday (AFP) India's Prime Minister Manmohan Singh said the economy was set to expand by 7.5 percent annually over the next few years, making it one of the world's fastest-growing major economies.

But Singh said the country of more than one billion people could attain 10 percent growth in a few years if it made a "quantum leap" in agriculture and boosted infrastructure and savings.

"We should be targeting a 10 percent growth rate in two to three years time," Singh told an economic forum. "This is eminently feasible."

But achieving 10 percent growth hinges on "the expected increase in our savings rate arising out of a young workforce, if we manage to make a quantum leap in the growth rate of agriculture and if investments in infrastructure provide a fresh impetus to industry," Singh said.

The Congress-led coalition government, which came to power in 2004, has identified agriculture - employer of nearly two-thirds of India's workforce - as a priority sector, calling it the "key to prosperity in our country." Singh said a multi-billion rural development programme - Bharat Nirman or Build India - that the government has said will develop power, water supplies and other infrastructure would be launched next week. The programme reflects what political analysts say is an attempt by the government's to fulfil its commitment to rural voters.

They turfed out the previous market-friendly Hindu nationalist government, seeing few benefits of economic reforms, and Congress is keen to make good its debt to its supporters, they say. Singh said India's economy was poised to soar and the loan constraints were internal.

These constraints are imposed by "our social structures, our regional imbalances, our ability to handle inequity, and our ability to take hard but essential decisions," he said.

The government urged private enterprise to become involved in the transformation of the agriculture sector which supports some 600 million people. "If we sustain our efforts, we may see India becoming the granary of the world.

The private sector must not miss out on the opportunity," Singh said.