From Our Special Correspondent
Daijiworld Media Network - Bangalore
Bangalore, Dec 18: Inflation will moderate to 6 to 7 % by March 2012, if the present trend continues, Union Finance Minister Pranab Mukherjee said on Sunday.
He was speaking to reporters after a meeting with Chief Ministers of south zone states, union territories, and CEOs of public sector banks in Bangalore.
''It is true that we are going through difficult times. But this situation prevails not only in India but all over the world,” Mukherjee said.
The country’s GDP growth in the first quarter of 2011-12 was 7.7 % while it was 6.9 % in the second quarter.
In this context, we are also facing problems, he said pointing out that food inflation has come down despite high in manufacturing sector, fuel and certain other commodities.
''I do hope if the trend continues, inflation will come down to 6 to 7 % by March,” he said adding: ''I do agree headline inflation is still high, perilously close to double digit inflation.”
Japan, US and European counties have also been facing lot problems, the Union Finance Minister sadi.
As per the latest assessment there is no possibility of recovery of Eurozone comprising of 28 countries of the European Union, till thethird quarter of the next calendar year 2012.
There has been slow recovery in the US economy but “how long it will continue and how far is yet to be seen”.
“The growth rate in many emerging economies has declined and rate of inflation is high,” Mukherjee said.
Earlier, addressing the meeting of Chief Ministers of south zone states and union territories and CEOs and public sector banks and financial institutions, he expressed concern over delay in the take-off of 14 projects for which banks have committed an investment of Rs 39,424 crore in seven States and union territories in the southern region for want of clearances.
''It has come to my notice that in the southern region, 14 projects with a total investment of Rs 39,424 crore are pending for want of various approvals”, Mukherjee said.
He requested the Chief Ministers to pay personal attention to this aspect and review the status of approvals (relating to water, electricity, land and state-level environmental clearances, among others) in large projectes in their States.
''CMDs of PSBs have been advised to approach the State Governments for expediting the approvals in projects financed by them. Inordinate delay in grant of approvals (pending at the Central/state levels) results in cost and time overrun and thereby endangering the viability of the project itself, besides “locking the bank money,” he said.
The risk of the loans sanctioned/disbursed by the banks turning into non-performing assets is also significantly enhanced, he observed, adding that he had already reviewed the status of pending proposals with the concerned Central Ministers twice with a view to expediting such approvals.
"I have requested the Ministers to give the clearances within a specific time-frame", he added at the meeting attended by Chief Ministers D V Sadananda Gowda (Karnataka), N Kiran Kumar Reddy (Andhra Pradesh), Oommen Chandy (Kerala) and N Rangasamy (Puducherry), Tamil Nadu Finance Minister O Panneerselvam and top officials from Andaman & Nicobar Islands and Lakshadweep.