India can replace China as driver of global growth, says FM Arun Jaitley

New Delhi: Seeing an opportunity in the recent turmoil in global equity and currency markets, Finance Minister Arun Jaitley on Thursday said India, with 8-9% growth rate, can replace China as the driver of world economy.

The country has already laid down a “red carpet” for businesses which want to invest here, he said, committing to push ahead with the government’s reforms agenda.

“The world needs other engines to carry the growth process. And in a slowdown environment in the world, an economy which can grow at 8-9%, like India, certainly has viable shoulders to provide the support to the global economy,” he said.

In an interview to BBC, Jaitley said India is an investor-friendly destination and investors need not fear any retrospective legislations.

“My message to the people wanting to do businesses in India is that there is a red carpet laid down for you. India needs investments, India invites investments and we are going to be one of the more investor-friendly destination,” he said, adding that the present government will never resort to retrospective taxation.

Indian economy grew by 7.3% in 2014-15 and is estimated to grow by 8-8.5% in the current fiscal.

“In an environment where there is a relative global slowdown, India seems to be doing reasonably well. We finished last year with 7.3% growth rate, will probably finish this year with a slightly better growth rate than that and next year hopefully will be a little better,” Jaitley said.

According to International Monetary Fund (IMF), India will overtake China as the fastest growing emerging economy in 2015-16 by clocking a growth rate of 7.5%.

On the other hand, China will witness a deceleration with growth rate sliding from 7.4% in 2014 to 6.8% in 2015 and 6.3% a year after.

Meanwhile, RBI Governor Raghuram Rajan had on Wednesday said it will be “a long time” before India can replace China as a growth engine for the global economy, even if it grows at a faster rate.

Jaitley said, “I see this as a great opportunity. The Chinese normal has now changed. It is no longer the 9%, 10%, 11 growth rate”.