Economy can grow 6.4 per cent in 2015, says World Bank chief

World Bank on Sunday said India can grow at 6.4 per cent in 2015 and accelerate further in 2016, but cautioned that an enduring "bias" on the basis of caste and other factors could impede prosperity.

The government, however, is well aware of this issue and the World Bank sees the country as "a bright spot in an otherwise mediocre global economic outlook," World Bank President Jim Yong Kim said in Gandhinagar at the 2015 edition of the Vibrant Gujarat Summit.

"Indian society has an enduring exclusion that is based, among other things, on caste identities. This bias can impede shared prosperity, serving as a basis for discrimination in many spheres, including in employment and other markets, as well as in public services," Kim said.

Acknowledging the government's efforts to address such issues, Kim said that Prime Minister Narendra Modi has focused on programmes to promote "broad-sharing of its benefits", in addition to action that will accelerate growth.

"Its (government's) special allocation of a fund for entrepreneurs from among the Scheduled Castes, and its focus on fixing bottlenecks so that money earmarked for the Scheduled Tribes reaches them, are both ethically just and economically sound responses," the multilateral lending agency's chief added.

Speaking at the annual Vibrant Gujarat summit, inaugurated on Sunday by PM Modi, the Kim said that there is much reason for optimism among investors, entrepreneurs and CEOs thinking of doing business in Gujarat and the country as a whole.

"According to our projections, its (India's) economy is expected to grow 6.4 per cent this year and even faster in 2016," World Bank chief said.

He said Prime Minister Narendra Modi and his government are quickly putting in place the building blocks for even more rapid growth, streamlining the national regulatory structure, using public funds more efficiently, and promoting social inclusion.

After the country's growth slowed to below five per cent in the previous two financial years, the domestic economy has started showing signs of pick-up as it expanded by 5.7 per cent and 5.3 per cent in the second and third quarter of the ongoing 2014-2015 financial year.