Economy seen growing at 7.2% in FY-10: Government
Analysts say govt may start to unwind its fiscal stimulus in the forthcoming budget. Check out top gainers, losers & recommendations | Quote: Jubilant Foodworks
By Agencies |
NEW DELHI: Government on Monday forecast its economic growth for this fiscal at 7.2 percent, as against 6.7 percent achieved in the previous fiscal, despite a 0.2 percent declined predicted in farm output. This reinforces the possibility that the government may start to unwind its fiscal stimulus in the forthcoming budget. (Watch)
The official growth forecast is line with other estimates this month that the pace of growth will quicken, and comes amid some indications that Reserve Bank of India could raise interest rates even before its next policy review in April to dampen inflation.
"These numbers means that the government will have to consider exiting from the fiscal stimulus in the budget," said Rajiv Kumar, CEO of ICRIER, a Delhi-based think-tank.
"Even if they don't do that fully, I expect them to at least announce a roadmap for exit ... The RBI will probably watch the government action on the stimulus exit in the budget before taking a call on interest rates."
The advance estimates of the country's gross domestic product released by the Central Statistical Organisation (CSO) forecasts a growth of 9.9 percent in services and 8.9 percent in manufacturing -- the highest among the eight broader economic activities.
Mining and quarrying comes next with an 8.7 percent expansion followed by 8.3 percent for trade, hotels, transport and communications, and 8.2 percent each for energy and water, and social and community services.
The per capita income in real terms is also likely to expand 5.4 percent to Rs.33,540, compared to Rs.31,821 in the previous fiscal, said a statement from the agency, under the ministry of statistics and programme implementation.
"These advance estimates are based on anticipated level of agricultural and industrial production, analysis of budget estimates of government expenditure and performance of key sectors like, railways, transport other than railways, communication, banking and insurance, available so far."
Last month, the Reserve Bank of India (RBI) revised its GDP estimate to 7.5 percent from 6.5 percent for the current financial year ending March, and lifted its wholesale price index inflation forecast for the fiscal year to 8.5 percent.
Policymakers, including Prime Minister Manmohan Singh, have said they expect the economy to grow around 7.5 percent in the fiscal year ending March.
The percentage growth under the eight categories of business activities for this fiscal are as under, with figures for previous fiscal in brackets:
- Overall gross domestic product: 7.2 (1.6)
- Agriculture, forestry and fishing: -0.2 (1.6)
- Mining and quarrying: 8.7 (1.6)
- Manufacturing: 8.9 (3.2)
- Electricity, gas and water supply: 8.2 (3.9)
- Construction: 6.5 (5.9 )
- Trade, hotels, transport and communication: 8.3 (7.6)
- Financing, insurance, real estate business services: 9.9 (10.1)
- Community, social and personal services: 8.2 (13.9)
The official growth forecast is line with other estimates this month that the pace of growth will quicken, and comes amid some indications that Reserve Bank of India could raise interest rates even before its next policy review in April to dampen inflation.
"These numbers means that the government will have to consider exiting from the fiscal stimulus in the budget," said Rajiv Kumar, CEO of ICRIER, a Delhi-based think-tank.
"Even if they don't do that fully, I expect them to at least announce a roadmap for exit ... The RBI will probably watch the government action on the stimulus exit in the budget before taking a call on interest rates."
The advance estimates of the country's gross domestic product released by the Central Statistical Organisation (CSO) forecasts a growth of 9.9 percent in services and 8.9 percent in manufacturing -- the highest among the eight broader economic activities.
Mining and quarrying comes next with an 8.7 percent expansion followed by 8.3 percent for trade, hotels, transport and communications, and 8.2 percent each for energy and water, and social and community services.
ADVERTISEMENT
The per capita income in real terms is also likely to expand 5.4 percent to Rs.33,540, compared to Rs.31,821 in the previous fiscal, said a statement from the agency, under the ministry of statistics and programme implementation.
"These advance estimates are based on anticipated level of agricultural and industrial production, analysis of budget estimates of government expenditure and performance of key sectors like, railways, transport other than railways, communication, banking and insurance, available so far."
Last month, the Reserve Bank of India (RBI) revised its GDP estimate to 7.5 percent from 6.5 percent for the current financial year ending March, and lifted its wholesale price index inflation forecast for the fiscal year to 8.5 percent.
ADVERTISEMENT
Policymakers, including Prime Minister Manmohan Singh, have said they expect the economy to grow around 7.5 percent in the fiscal year ending March.
The percentage growth under the eight categories of business activities for this fiscal are as under, with figures for previous fiscal in brackets:
ADVERTISEMENT
- Overall gross domestic product: 7.2 (1.6)
- Agriculture, forestry and fishing: -0.2 (1.6)
- Mining and quarrying: 8.7 (1.6)
- Manufacturing: 8.9 (3.2)
- Electricity, gas and water supply: 8.2 (3.9)
- Construction: 6.5 (5.9 )
- Trade, hotels, transport and communication: 8.3 (7.6)
- Financing, insurance, real estate business services: 9.9 (10.1)
- Community, social and personal services: 8.2 (13.9)
Download
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
