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‘Financial services, the next engine of growth’

— PHOTO: PTI

SHIFTING GEARs: Union Finance Minister, P. Chidambaram (right), shakes hands with the Managing Director and CEO of ICICI Securities, S. Mukherji (second from left) at the ‘India unlimited’ conference in New York on Thursday.

NEW YORK: India has said that its growth story, steered mainly by IT and telecom so far, will shift gear towards financial services to drive expansion.

“It is our intention to make financial services the next growth engine for India,” Finance Minister P. Chidambaram said at ICICI Securities Investor Conference here on Thursday.

As the economy became more open and trade intensity increased, big financial flows would be intermediated in India, he said. Pointing out that India was a purchaser of international financial services, he said that there was an opportunity for India to become a provider of these services as well.

He cited a recent report to say that these services were valued at $13 billion a year and would rise to $48 billion by 2015.

A government constituted committee had earlier this year submitted its recommendations on making Mumbai an international financial centre.

“It is, therefore, our intention to make Mumbai an international financial centre,” he said, adding that the report was in the public domain and the process of building a consensus on the key recommendations was on.

Pointing out that the outlook for the Indian economy is positive, Mr. Chidambaram said the factors that were driving the current growth were domestic consumption, rise in investment, increase in employment and increase in productivity of both labour and capital.

“I do not foresee any change for the worse in these factors. While there are some risks such as crude oil prices and commodity prices, we are confident that we would be able to manage these risks without hurting the process of growth,” he said. — PTI

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