New Delhi: India's expenses on government procurement in the next two years will grow to a whopping Rs 6,50,000 crore, which would revive the economy impacted by the world credit crisis, Heavy Industry and Public Enterprises Minister Sontosh Mohan Dev said today.

"Due to current world economic crisis...all are talking cost reductions and cost savings in day-to-day consumption. In view of (this) government procurement is to be used as a specialised instrument for globalisation of economy and boosting the domestic demand," Dev said at an Assocham function here.

Government s annual expenses on its procurement is estimated to be Rs 500,000 crore.

"In view of the increased economic activities happening in India because of its potential factor, we expect this procurement may go up by at least 25 to 30 per cent in the next two years," he said.

While the Indian economy of late has come under the impact of the global slowdown, different estimates including that of the Reserve Bank of India suggests its GDP would grow in the range of 7-7.5 per cent this year.

Government, with over Rs 700,000 crore tax revenue, is the largest single purchaser in the economy, which can also be boosted by the borrowings.

"Government is one of the biggest buyer of goods and services and our economy has evolved into one of the biggest world markets offering tremendous opportunities," Dev said.

Source : PTI