In the backdrop of the RBI's tight monetary policy and high inflation, Mr C Rangarajan chairman of PEMAC said that India's economic growth in the 2011-12 fiscal is likely to be about 8.5% lower than the Budget projection.

Mr Rangarajan at an Organisation for Economic Cooperation and Development event said that "I believe (it would be closer to) 8.5%.”

In his Budget speech, Finance Minister Pranab Mukherjee had pegged economic growth for 2011-12 at 9%. However, the Reserve Bank, in its monetary policy in May, said that GDP growth during 2011-12 would be only around 8%.

The Chairman of the Prime Minister's Economic Advisory Council however, exuded confidence that India has the potential to clock GDP growth of 9% in the medium term. He added that “Potential (for Indian economy) to grow at 9% exists.”

(Sourced from ET)