The president-elect of the Confederation of Indian Industry Sunil Kant Munjal on Sunday welcomed the common minimum programme of the Congress-led government at the Centre, saying it would contribute to growth and help continue the reforms.

Munjal told reporters, "The year 2003 was a wonderful year for the country on the whole. Growth rate in the last quarter of the financial year was 10.2 per cent, which was the highest for the period in the whole world. The overall growth rate for the entire year was 7.2 per cent. The manufacturing sector witnessed a growth of 7.1 per cent, while services and agricultural sectors grew by 9 per cent and 16 per cent, respectively. Exports witnessed a growth of 12.7 per cent, even as forex reserves touched the $118 billion mark."

Munjal, however, cautioned that it would not be easy to sustain this growth rate.

"The agricultural sector witnessed a high growth rate and played a crucial role in the growth rate achieved in the previous year. It is difficult to sustain this growth rate in agricultural sector. So if we have to achieve 8 per cent growth, manufacturing and services sectors will have to make higher contributions," he said.

Munjal expressed confidence that the country has the potential to achieve the growth rate.

"Until a few years back, there were strong doubts if India could achieve 8 per cent growth. But we have almost achieved this target, so it is proved that we have the potential. Poverty has been reduced in the last few years, growth has taken place and wealth has increased. Purchasing power of the middle-class has gone up, so these are some positive signs," Munjal said.

The rural economy was also important for development, he said.

Munjal said, "Reforms are essential for progress, but overall development can be achieved only if we start focusing on the rural economy. There are several disparities between rural and urban economies, which need to be removed."

He said, "The second Green revolution is very much possible in the country by bringing new technology. But only increasing productivity will not be sufficient."

He advised the farming community to concentrate on value additions and agro-processing for better results.

He said, "South Gujarat and especially Surat has a lot of potential. Many industries  in this region are doing very good."

Munjal said the cluster development project would be launched shortly in Surat, Vadodara and Rajkot.

He said the project had produced incredible results in Chandigarh and the same was expected in other places.

To a query about the value added tax (VAT), Munjal said, "We have strongly recommended to the government that VAT be implemented at the earliest. There are huge differences in tax structures of different states, so once VAT is implemented, it will give a level-playing field to industries."

About the roller-coaster ride of the Sensex since the new government took over, Munjal said, "The Sensex fall was mainly due to nervousness. Investors are watching the attitude of the new ministers and the various parties that are part of the government or are supporting it from outside. This is a testing time for the stock market, but it should settle down shortly."