Press Esc to close
Monday 20 October 2014
News updated at 4:46 PM IST
Weather
Max: 30.8°C
Min : 20.1°C
In Bangalore
Sunny day

Economy may grow 5.5-6% in 2012-13: Rajan

New Delhi, Dec 15, 2012, DHNS:

‘Need to be cautious on spending front’

Chief Economic Advisor Raghuram Rajan

A marginal improvement in growth in the second half of the year is likely to enable India to post a 5.5 to 6 per cent GDP growth rate in 2012-13, according to Chief Economic Advisor Raghuram Rajan.

“I would be surprised if there is more deterioration (in growth rate) from here. The numbers that have been talked about are in the 5.5-6 per cent range. And I feel comfortable sitting with that,” he told reporters on the sidelines of the Ficci AGM here.

Referring to the recent IIP number that indicated a bounce back at 8.2 per cent in October, 2012, compared to a contraction in October last year, he said, “I think it is too early to say confidently that the economy has turned the corner ... Given that the beginning of the announcements that increased confidence, buoyancy in the stock markets started in September, this creates an environment for business to start investing.”


He said the government would do its best to stick to the 5.3 per cent fiscal deficit target for 2012-13, while advising fiscal prudence. “We have to be careful about everything we spend on. That’s how we are going to get back on fiscal track, being careful.”

On the recent decline in WPI inflation, Rajan said,  “As we go into the next year, some softening of inflation is to be expected. Certainly that core inflation came down quite strongly in the latest numbers is a reason for confidence". The WPI inflation fell to a 10 month low of 7.24 per cent in November 2012 from 7.45 per cent in October.

To a query on whether increasing tax would help curb gold imports, Rajan said, "The better approach for us is to make financial instruments more attractive.We need to see the process of gold import, if people are holding it in gold bars, then we have to see is if we can make the financial instruments more attractive.”

The import of gold had declined to 398 tonnes in April- October of the current fiscal, from 589 tonnes in the corresponding period last year. In value terms, it has declined from Rs 1.40 lakh crore to Rs 1.15 lakh crore.

The economic growth slowed to a nine year low of 6.5 per cent in 2011-12 and this year, too, the GDP growth, as per RBI's estimates, is likely to be 5.8 per cent. In the three years preceding the 2008 global economic crisis, India was growing at a rate of more than 9 per cent.

Go to Top

Photo Gallery
Army recruits during their attestation parade at Madras Regimental Centre, Wellington, Ooty on...

Army recruits during their attestation parade at Madras Regimental Centre, Wellington, Ooty on...

In this Wednesday, Oct. 15, 2014 photo, a Kashmiri woman blocks a road during a protest demanding...

In this Wednesday, Oct. 15, 2014 photo, a Kashmiri woman blocks a road during a protest demanding...

Prime Minister Narendra Modi at the 42nd Convocation of the All India Institute of Medical...

Prime Minister Narendra Modi at the 42nd Convocation of the All India Institute of Medical...

Devendra Fadnavis hugs his mother Savita after his victory during the Assembly election in...

Devendra Fadnavis hugs his mother Savita after his victory during the Assembly election in...

Union Minister of State for Commerce and Industry, Nirmala Sitaraman launching the Online Export...

Union Minister of State for Commerce and Industry, Nirmala Sitaraman launching the Online Export...

Prime Minister Narendra Modi with BJP President Amit Shah after the party's parliamentary...

Prime Minister Narendra Modi with BJP President Amit Shah after the party's parliamentary...

In this Oct. 17, 2014 photo, a thick blanket of smoke is seen against the setting sun as...

In this Oct. 17, 2014 photo, a thick blanket of smoke is seen against the setting sun as...

In this Monday, Oct. 13, 2014 photo, an Indian woman uses her hand to put sawdust in an...

In this Monday, Oct. 13, 2014 photo, an Indian woman uses her hand to put sawdust in an...

(L-R) Asha Bhat, Miss Diva Universe 2014 2nd runner up, Noyonita Lodh, Miss Diva Universe 2014...

(L-R) Asha Bhat, Miss Diva Universe 2014 2nd runner up, Noyonita Lodh, Miss Diva Universe 2014...

An Indian man teaches yoga postures to schoolchildren at Delhi Public School in Hyderabad...

An Indian man teaches yoga postures to schoolchildren at Delhi Public School in Hyderabad...

Copyright 2014, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bangalore - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523