PM panel may revise GDP growth upwards

“The current GDP growth has turned out to be much more positive than one has expected. Both industry and services have grown strongly. Overall growth of 6.5 per cent may have to be revised upward,” Prime Minister’s Economic Advisory Council (PMEAC) Chairman C Rangarajan told PTI. He further said that the dampening effect of a weak monsoon on agriculture is much smaller than anticipated. The GDP growth for this quarter against the 6.1 per cent in the first quarter, reflects a good showing by the industry and the services sector. In the July-September period, the manufacturing sector grew by 9.2 per cent compared to 5.1 per cent in the corresponding period of last fiscal and mining and quarrying by 9.5 per cent versus 3.7 per cent recorded in the financial year 2009. Community, social and personal services expanded by double digit at 12.7 per cent against nine per cent. Agriculure also rose by 0.9 per cent expansion, against expectations of contraction in the second quarter.

Status quo on fiscal stance
Rangarajan further said that he expects no change in fiscal policy by the end of the this fiscal, but the central bank’s main focus would now be to tame inflation. “As far as policy stance is concerned, I expect no change in fiscal policy till March-end, 2010. RBI’s monetary policy would now be more focussed on inflation,” he added.