NEW DELHI: Upbeat on economic fundamentals, the Union Finance Minister, Mr Pranab Mukherjee on Thursday said India will cross growth projections of 8.75 per cent this fiscal, but cautioned that infrastructure posed a challenge to bigger expansion.

“I am optimistic that at the end of this year we will be able to surpass our GDP growth forecast of 8.5-8.75 per cent,” Mr Mukherjee said at a meeting of the Indo-German Joint Commission on Industrial and Economic Cooperation.
However, he added that infrastructure bottlenecks may be a challenge to 9-10 per cent growth and invited German companies to take part in the public-private-partnership model to expand core sector industries.
Mr Mukherjee’s optimism on growth was shared by economists.
“We are on advantageous position because of the lower base of last year. This coupled with good agriculture output (mainly wheat and pulses) and rural demand would boost economic growth,” said Religare Capital Markets chief economist,
Dr Jay Shankar.
He said industrial growth is also expected to be higher in the coming quarters and help India achieve over 8.5 per cent growth in the current fiscal.
On whether India could achieve over 8.75 per cent growth, Shankar said, “I am optimistic”
Mr Mukherjee said the economy registered 7.4 per cent growth in 2009-10, driven by the robust performance of manufacturing sector on the back of government and consumer spending.
For the first quarter of this fiscal, the economy grew by 8.8 per cent growth.
On the constraints to the big growth, the Finance Minister said, “Our infrastructure has lagged behind acceleration in growth, and presents a challenge. We need much more investment in sectors such as power, railways, ports and aviation.”