India Growth May Not Touch 8% This Fiscal:?Montek.

NEW DELHI Amid fears of slowdown, the Planning Commission on Wednesday said India may not achieve over 8 per cent economic growth in the current fiscal on account of likely fallout of global uncertainties on the domestic economy.

“I don’t think so...We never felt that this year was going to be a big growth year,” Planning Commission Deputy Chairman Montek Singh Ahluwalia said when asked if India could achieve over 8 per cent gross domestic profit (GDP) growth in 2011-12.

India’s economic growth rate moderated to 7.7 per cent in Q1 of 2011-12 compared to 8.8 per cent the same period last fiscal. This was the lowest growth in the last six quarters. The Planning Commission has earlier pegged the GDP growth for 2011-12 at 8-8.3 per cent.

The government has projected a growth rate of 8.5 per cent, while the Reserve Bank came out with an estimate of 8 per cent. The economy expanded by 8.5 per cent in 2010-11.

Ahluwalia said what is more important than achieving 8 per cent growth is “how we get out of the slowdown (and move to) higher growth path”.

The Planning Commission Deputy Chief said that the situation could improve with a pick up in the growth in the remaining part of the fiscal.

In the recent full Planning Commission meeting headed by Prime Minister Manmohan Singh, the panel has decided to aim for 9 per cent annual average economic growth in the 12th Five Year Plan. A data released by the Central Statistical Organisation on India’s gross domestic product presented a mixed bag for the Indian economy that grew by 8.5 per cent in 2010-11 and 8 per cent in the year before.

The Prime Minister’s Economic Advisory Council had projected GDP to grow 8.2 per cent in the cur.rent fiscal. Finance Minister Pranab Mukherjee termed the growth figures disappointing but said it came in the wake of global economic uncertainty.

Tuesday’s figures showed a sharp fall in the growth of construction and mining sectors, at 1.2 per cent and 1.8 per cent in the quarter ended June, from 7.7 per cent and 7.4 per cent, even as the growth in services such as transport and trade was higher, 12.8 per cent.

While agriculture grew at 3.9 per cent, against 2.4 per cent last year, electricity and gas expanded by 7.9 per cent, against 5.5 per cent, and financial services grew by 9.1 per cent.

Federation of Indian Chambers of Commerce and Industry secretary general Rajiv Kumar said if the economy had to grow 8.2 per cent, the GDP would have to expand by 8.3 per cent for the remainder of the fiscal.

Source : omantribune.com