While the demand hitting badly than anticipated, the Prime Minister''s economic advisory council (PMEAC) has lowered India''s growth rate forecast to 6.5-7 per cent from previous projection of 7.1 per cent for 2008-09.
"It (growth rate for 2008-09) may go somewhere around 6.5-7 (per cent), that is the current estimate... 7.1 per cent was earlier estimate, obviously it has to be lower. Because the contraction of trade turned out to be much greater than it was anticipated," said, PM''s Economic Advisory Council (PMEAC) Chairman Suresh Tendulkar.
The PMEAC in January revised down its growth projection to 7.1 per cent for 2008-09 as against 7.7 per cent projected earlier due to "painful adjustments to the abrupt changes in the international economy".
Tendulkar said that the Indian economy was affected by the global crisis through the export and export-related industries and capital outflows. "There was deeper than expected recession in advanced countries. The psychology of gloom and doom that was essentially pervaded in the industrialized countries was imported to this country," Tendulkar said.
In order to deal with this and to give a boost to the economy, the government came out with three stimulus packages by providing incentives to various sectors. Besides this, the Reserve Bank of India also took monetary easing measures by infusing more than Rs 4,00,000 crore since October.
The industrial growth turned negative in October and December and the industrial output again fell in January, despite the stimulus packages. The exports also fell for the fifth consecutive month in February after it had a good run in the first half of 2008-09.
"It (growth rate for 2008-09) may go somewhere around 6.5-7 (per cent), that is the current estimate... 7.1 per cent was earlier estimate, obviously it has to be lower. Because the contraction of trade turned out to be much greater than it was anticipated," said, PM''s Economic Advisory Council (PMEAC) Chairman Suresh Tendulkar.
The PMEAC in January revised down its growth projection to 7.1 per cent for 2008-09 as against 7.7 per cent projected earlier due to "painful adjustments to the abrupt changes in the international economy".
Tendulkar said that the Indian economy was affected by the global crisis through the export and export-related industries and capital outflows. "There was deeper than expected recession in advanced countries. The psychology of gloom and doom that was essentially pervaded in the industrialized countries was imported to this country," Tendulkar said.
In order to deal with this and to give a boost to the economy, the government came out with three stimulus packages by providing incentives to various sectors. Besides this, the Reserve Bank of India also took monetary easing measures by infusing more than Rs 4,00,000 crore since October.
The industrial growth turned negative in October and December and the industrial output again fell in January, despite the stimulus packages. The exports also fell for the fifth consecutive month in February after it had a good run in the first half of 2008-09.
No comments:
Post a Comment