Due to the existing high interest rates and falling consumer demand, new investments may take a strike, the government was informed by the Industry leaders.

The industries are concerned that the high inflation and high interest may adversely affect the new projects, which haven’t been started as yet. Confederation of Indian Industry President K V Kamath, after the meeting of industry leader with Finance Minister P Chidambaram, informed that existing investments pipelines are still on route, but the newer projects are at risk.

The president of Confederation of Indian Industry also informed that the finance minister has instructed them to continue with their investment plans. He further informed that the finance minister explained the industrialists a to what all is happening in the economy and further tried to boost their confidence by explaining for the coming years, high growth cycle will stay in.

Kamath also quoted the Finance Minster, “Industry should look at it very positively. Between 8 and 9 per cent GDP growth is here to stay and this is backed by the numbers, particularly the high investment rate.”

Further, the CII president also informed that Chidambaram has said that though due to global factors, the growth may have slowed down marginally, but in the coming times, this situation would reverse itself.

Kamath reported, “On its part, the confederation has projected a GDP growth 8-8.5 per cent in 2008-09 and said that its earlier estimate of $700 billion investment over the next three years remains intact. The finance minister said industry should believe in the overall growth story and continue to invest. This was critical and imperative for growth of the country as well as industry.”