Monday, March 24, 2008

PM’s EAC retains GDP growth projection for next fiscal at 8.5%

by Jo Black

The Prime Minister’s Economic Advisory Council has retained its projection for economic growth at 8.5 per cent for the next fiscal, despite a slowdown in the industrial sector, rising inflation rate and global uncertainty.

“I think that (GDP growth of 8.5 per cent in 2008-09) should still hold,” Council Chairman C Rangarajan told reporters.

Earlier, reacting to slowdown in industrial growth for the month of January, he had said the GDP growth next fiscal would depend on “whether trend in industrial production will reverse or not”.

What has happened to consumer durable sector can reverse itself if cyclical upturn begins, he had said.

Growth in industrial production slipped to 8.7 per cent in April-January 2007-08, compared to 11.2 per cent in 2006- 07. Industrial growth for January nosedived to 5.3 per cent compared to 11.6 per cent in the same month last year

Output of consumer durables registered a negative growth of 3.1 per cent in January, against positive 5.3 per cent growth in the same month last year.

“Slowdown in industrial production could be cyclical and budget steps could boost industrial production,” he had said.

The council has, however, marginally scaled down its growth projections to 8.9 per cent for this fiscal from 9 per cent earlier, on account of slow expansion in manufacturing and energy generation.

The Central Statistical Organisation, on the other hand, projected the economy to grow at 8.7 per cent this fiscal.

 

 

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