Press Trust of India 

WASHINGTON, Oct 11: Dismissing fears of global financial contagion impacting India, the International Monetary Fund has said that the country's economy will continue to perform well.

"Overall, we see the Indian economy continuing to perform well," said Oliver Blanchard, Economic Counselor and Director of International Monetary Fund (IMF) Research Department here recently.

Pointing out that there will be some impact of the tighter global liquidity conditions on India, he said, "We don't see major drag from this impact on the country."

According to the projections made by the World Economic Outlook (WEO) released recently by the IMF, India is likely to register a Gross Domestic Product (GDP) growth of 7.9 per cent in 2008-09, which may slip to 6.9 per cent in 2009-10.

"We are projecting that the growth in India will come down from eight per cent in 2008 to seven per cent in 2009. But seven per cent is still a strong rate of growth," the IMF official said.

A likely seven per cent growth rate at a time when the world economy is on a downhill path, would reflect India's internal growth dynamics, he said.

Giving reasons for relatively mild impact on India of the ongoing financial turmoil, Blanchard said, "India is still largely a closed economy, has strong internal growth dynamics, from rapid productive growth, from its process of integration into the global economy that is still continuing".

India has registered a growth of nine per cent during 2007-08 and according to Prime Minister Manmohan Singh it is likely to register a growth of 7.5-8 per cent during the current financial year.