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India Needs More Stimulus Measures says Ahluwalia

India will need to introduce further measures to stimulate growth, said Montek Singh Ahluwalia, deputy chairman of the nation’s Planning Commission, ahead of a Group of 20 meeting on the global economic crisis.

The new government that takes over in May after general elections will need to take steps to try and maintain the current year’s economic growth, Ahluwalia said at the Confederation of Indian Industry’s annual conference in New Delhi today.

India’s Prime Minister Manmohan Singh is heading to London next week to attend a meeting where leaders of the 20 major economies will discuss ways of spurring global growth. The International Monetary Fund has urged countries to spend at least 2 percent of gross domestic product on stimulus, estimating that only Saudi Arabia, Australia, China, Spain and the U.S. will introduce budget boosts worth that much this year.

The government has injected about 4.3 trillion rupees ($85 billion) into the economy since September, India’s cabinet secretary K.M. Chandrasekhar, said at the same meeting today. The impact of the global financial crisis was first felt in India in that month with a freeze in the credit market.

The new government must spend as much as 1 percent of GDP as extra stimulus, Ahluwalia said earlier.


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