Finance minister P Chidambaram had echoed similar thoughts at the annual Economic Editor''''s Conference (See: Macro-economics still strong, says Chidambaram).

Speaking to CNBC-TV18, Vyas added that the IIP numbers were expected to fall though not to such an extent. And According to him, high interest rates have bothered consumer goods. He added that the electricity generation growth rate was disappointing but it should pick up in the months to come.

Vyas said that the fall in growth rate of metals is inexplicable and it may get revised. He expects growth to return to around 10 per cent levels. He added that interest rates have started to weaken which should boost IIP numbers.

Commenting on inflation, he said that it will decline further. Vyas said that WPI is not an accurate benchmark of inflation and added that inflation is falling though not as much as WPI is indicating.

Agriculture meanwhile, according to him, will continue to do well in the current year and will stabilize at around 3.5 per cent. Commenting that he is optimistic on the Indian economy for the next two years, Vyas said that 9.1 per cent growth is a modest number and it could be much better.

CNBC-TV18 shares with domain-b its exclusive interview with Vyas:

Are you worried or do you think it''''s just a blip?
This is just a blip, there''''s nothing to worry about, this is partly expected, not as sharp as it has actually fell but this is certainly not something to worry about.

What do you think caused it and do you think it will get back on track next month?
Partly there are some sectors which have been doing badly like the consumer durable section largely because of the higher interest rates. This has been bothering the consumers durables industry for sometime and therefore, this growth has been low.

What has been a little worrying is the drop in the growth rate of electricity generation. In the last two three months, not only in September but also in the latter month in October, the growth rate has dropped because hydro generation has declined and thermal generation hasn''''t picked up as it was expected. But I expect even this to be a small blip because the reservoir levels are quite good, there isn''''t any major problem, there is no reason why electricity should not recover back to healthy growth rates.

The only inexplicable problem that I see is the fall in the growth rate in the metal section. There is no reason why they should have fallen and I hope that the IIP numbers will get revised in the next month to correct the situation. Further, there are no basic surprises in this.

So next month you expect to see a significantly rise in number think or will they be steady?
It will be a significant improvement compared to what we saw for September, but it will be more or less in line with what we have seen before that. So I expect the industry to continue checking close to 10 per cent or so.

September being particularly a bad month, I expect things to improve there after essentially because the rise in interest rates which has caused the consumer durables to grow slowly is possibly over now as interest rates have started weakening again.

I expect the coming month to be better and the following months to be even better.

How do you read this WPI numbers, last week was the first time we went sub 3 per cent. Do you think it is an accurate reflection of inflation?
Well it certainly is not an accurate reflection of what inflation is, but it certainly does indicate what are the trends reasonably accurately. So inflation may not be around 3 per cent as the WPI indicated last week, but it certainly is falling compared to the 7 per cent numbers we used to see several months ago.

The Consumer Price Index is still slightly high and that''''s a more accurate indication of inflation. So I would say inflation is declining, it''''s headed to decline even more and although WPI is not an accurate indicator, it''''s a reasonably okay indicator of the trends in inflation.

I would expect inflation to remain low around 4.5 per cent or so.

What do you expect to see on the agricultural front over the next three to six months because we hear that the kharif (crop) has been very good this time. What is your sense of how much that can contribute to growth this time?
Significantly, our projection is that agriculture will grow by nearly 4 per cent this year which is substantially higher than the trend for around 2 - 2.5 per cent or so. Agriculture has been steadily improving in the recent past, so I expect agriculture to do well in this year and then to stabilize around 3.5 - 4 per cent in the coming years as well. So this is a good year for the agricultural output.

Most of the other think tank seems to be veering around that 8.5 per cent growth figure for this year. Your projection seems to be among the more optimistic at 9.1 per cent. What is accounting for that optimistic differential if you will?
It is difficult to comment on what is accounting for the difference, I can only say what makes us say it is 9.1 per cent. I do not know what the reasoning for the other forecasts are, but we certainly are quite optimistic on the Indian economy this year and even in the next year. Although we do not have a number for the next year, the economy does look in the best of health that one can think of. Right now, 9.1 per cent is a modest number according to us, it''''s quite likely that this number could be even better.

This is largely driven by the investment boom, so the IIP numbers of September did show a fall in the capital goods index, but that is not to worry about because broadly, investments are on track and I see no reason why that should slowdown. And it is because of this investment boom that we believe that the economy will do 9.1 per cent this year.

At this point, do you think the RBI''''s tightening measures have done what they intended to do? Do you expect to see a turn in tone at least any time soon?
If the RBI had intended to stop the economy from overheating, the IIP numbers of September do indicate success on that front. If the objective was to do this to bring inflation in control, then there is success over there as well.

Having succeeded in stopping the economy from overheating and from high inflation rates, I think the stance will be more growth oriented and we will not hopefully cause further declines in the growth rates by tightening of interest rates and consumer durables slowing down.

So, I would expect the policy stance to be more growth oriented, to be a little more easing of interest rates and easing of liquidity in the coming months.

What''''s your sense of the kind of flows that we are seeing in the rupee and how much the current restrictions on capital flows can actually do to arrest that and resulting your view on the rupee?
I don''''t have much of a view on the rupee really; I can talk about the balance of payments. I don''''t see any slowing down of the capital flows really. With the growth story that India has today I see no slowing down of FDI flows into India, FII flows into India, either which way the capital flows are going to remain strong. This means that the rupee should only be strengthening.