<p>The government’s Mid-Year Economic Analysis for 2013-14 on Thursday pegged India’s economic growth 5 per cent and said an economic recovery, although weak, is expected to gather pace in coming quarters.<br /><br /></p>.<p>Amid widespread fears of slowing demand in the economy, the report noted that despite cuts in government spending, private consumption expenditure and gross fixed capital formation have increased.<br /><br />“The demand side impetus to growth is gradually gaining momentum with the strengthening of private consumption and investment and with exports making an impressive turnaround in the first half (April-Sept) of 2013-14,” the report tabled in Rajya Sabha said Thursday.<br /><br />These trends indicate that the structural reforms undertaken by the government have started to bear fruit, and a decisive pick-up in economic activity can be gradually expected over the next few quarters," it said.<br /><br />However, it may take some more time for the economy to reach its higher growth potential, it said.<br /><br />"Reverting to a real GDP growth rate of above 8 per cent plus would take some more time as cyclical factors also need to revive alongside a restoration of demand based on expectations of sustained recovery," it said.<br /><br />The mid-year analysis, a flagship document of ministry of finance, said government’s fiscal consolidation was on track. For the current financial year, the government has pegged its fiscal deficit target at 4.8 per cent.<br /><br />WPI inflation target <br /><br />The inflation rate based on Wholesale Price Index needs to be controlled below 6 per cent for the Reserve Bank of India to support economic growth, the government said Thursday in its Mid-Year Economic Analysis for 2013-14.<br /><br />"(It requires) controlling inflation further (WPI inflation belowthe level of 6 per cent), so that necessary leeway is available to the RBI to support economic recovery," the report said. <br /><br />India's headline inflation rate, based on the Wholesale Price Index, had fallen to a five-month low of 6.16 per cent in December from a 14-month high of 7.52 per cent in the previous month.<br /><br /></p>
<p>The government’s Mid-Year Economic Analysis for 2013-14 on Thursday pegged India’s economic growth 5 per cent and said an economic recovery, although weak, is expected to gather pace in coming quarters.<br /><br /></p>.<p>Amid widespread fears of slowing demand in the economy, the report noted that despite cuts in government spending, private consumption expenditure and gross fixed capital formation have increased.<br /><br />“The demand side impetus to growth is gradually gaining momentum with the strengthening of private consumption and investment and with exports making an impressive turnaround in the first half (April-Sept) of 2013-14,” the report tabled in Rajya Sabha said Thursday.<br /><br />These trends indicate that the structural reforms undertaken by the government have started to bear fruit, and a decisive pick-up in economic activity can be gradually expected over the next few quarters," it said.<br /><br />However, it may take some more time for the economy to reach its higher growth potential, it said.<br /><br />"Reverting to a real GDP growth rate of above 8 per cent plus would take some more time as cyclical factors also need to revive alongside a restoration of demand based on expectations of sustained recovery," it said.<br /><br />The mid-year analysis, a flagship document of ministry of finance, said government’s fiscal consolidation was on track. For the current financial year, the government has pegged its fiscal deficit target at 4.8 per cent.<br /><br />WPI inflation target <br /><br />The inflation rate based on Wholesale Price Index needs to be controlled below 6 per cent for the Reserve Bank of India to support economic growth, the government said Thursday in its Mid-Year Economic Analysis for 2013-14.<br /><br />"(It requires) controlling inflation further (WPI inflation belowthe level of 6 per cent), so that necessary leeway is available to the RBI to support economic recovery," the report said. <br /><br />India's headline inflation rate, based on the Wholesale Price Index, had fallen to a five-month low of 6.16 per cent in December from a 14-month high of 7.52 per cent in the previous month.<br /><br /></p>
