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RBI chief sees economy growing by 6.3%

The Reserve Bank of India Governor Bimal Jalan said on Wednesday he expected the economy to grow by around 6.0-6.3 per cent in 2001-02.

Jalan told reporters on the sidelines of a parliamentary panel briefing that the monsoon will have a favourable impact on agriculture, on which two-thirds of India's population depends, and thereby on overall growth.

"Agriculture is good, the monsoons are good and growth is good. The economy will pick up," Jalan said.

"It (agricultural growth) should have an impact on rest of the economy."

"As of now we are expecting 6.0-6.3 per cent growth," Jalan said.

India's GDP growth slowed to 5.2 per cent last year, down from early projections of 7 per cent and subsequent estimates of 6 per cent.

Jalan also said the central bank was keeping an eye on interest rates and act when necessary.

"We are keeping a watch on interest rates," he said in response to a question on market expectations of a rate cut.

The RBI has already cut the bank rate twice in 2001, by a total of 100 basis points. It is now at 7 per cent.

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