'Economy: Urgent steps needed'

With India’s falling macro-economic indicators staring in the face, Chief Economic Advisor Raghuram G Rajan Wednesday said India was facing a difficult situation and needed urgent steps for stabilisation.

 “A high fiscal deficit, falling investments, falling savings, a high current account deficit and high consumer price inflation, all suggest urgent steps need to be taken for macroeconomic stabilisation,” Rajan told reporters after the Economic Survey for 2012-13 was tabled in Parliament.

 He, however, said that there was a glimmer of turnaround in the economy, but was quick to add that much more needs to be domestically for more sustainable growth.

 "What we need to do is turnaround investments, turnaround government savings and increase household savings," he said, adding that the way out of difficult times lies in shifting national spending from consumption to investment by removing  bottlenecks to investment, growth, and job creation. 

In the Economic Survey, Rajan has projected a gross domestic product growth between 6.1-6.7 per cent for 2013-14. When asked why there was a wide band in growth projection, Rajan said, the wide uncertainty in the global economy forced the Survey to resort to a wide band.  "We are at the turning point and it is very difficult to predict growth at this point,” he said.

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