"Our country is going through difficult times ... We are up to the task of meeting these challenges we face as a nation", he said while addressing the 10th Pravasi Bharatiya Divas being attended by over 1,900 overseas Indians.

Despite an adverse international environment, Singh said, "the Indian economy is expected to grow by about 7 per cent this financial year ending March 31."

The country recorded a Gross Domestic Product (GDP) growth rate of 8.5 per cent in 2010-11 and was initially estimated to grow by 9 per cent in the current fiscal. The growth rate projection, however, was scaled down gradually by the Reserve Bank as well as the Finance Ministry.

Although Finance Minister Pranab Mukherjee had yesterday said the growth rate in 2011-12 would be about 7.5 per cent, Singh further lowered the projection to 7 per cent.

The growth rate in the first half of the year slipped to 7.3 per cent from 8.6 per cent in the year ago period.

The Prime Minister, however, exuded the confidence that growth rate in the coming years would go up to 9-10 per cent as the "economic fundamentals are strong and consittutional processes are robust".

"...we hope to bring back the rhythm of our growth process to sustain an annual growth rate of 9-10 per cent in the medium-term. Our domestic savings rate which currently stands at 33-35 per cent of our GDP will greatly facilitate the realisation of our growth objectives", he said.