New Delhi, Aug 1 (ANI): The Chairman Economic Advisory Council to the Prime Minister, Dr. C. Rangarajan released the 'Economic Outlook 2011-12' here today
Following are the highlights of economic outlook:
Economy to grow at 8.2 per cent in 2011-12. Agriculture grew at 6.6 per cent in 2010-11. Projected to grow at 3.0 per cent in 2011-12
Industry grew at 7.9 per cent in 2010-11. Projected to grow at 7.1 per cent in 2011-12. Services grew at 9.4 per cent in 2009-10. Projected to grow at 10.0 per cent in 2011-12
The projected growth rate of 8.2 per cent, though lower than the previous year, must be treated as high and respectable, given the current world situation.
Global economic and financial situation unlikely to improve. Investment rate projected at 36.4 per cent in 2010-11 and 36.7 per cent in 2011-12
Domestic savings rate as ratio of GDP projected at 33.8 per cent in 2010-11 and 34.0 per cent in 2011-12
The 2011 monsoon projected to be in the range of 90 to 96 per cent of Long Period Average. As a result farm sector output expected to grow at 3 per cent
The revised series (2004/05) for Index of Industrial Production shows an output growth pattern that is fairly different from what the old series (1993/94) had indicated.
The output growth was grossly underestimated by the old series in 2007-08 and overestimated in 2008-09 and 2009-10.
The impact of the global crisis on industrial output was much stronger than had been indicated by the old series
In 2010-11 the output growth was higher at 8.2 per cent against 7.8 per cent indicated by the old series
Current Account deficit is 44.3 billion dollars (2.6 per cent of GDP) in 2010-11 and projected at 54.0 billion dollars (2.7 per cent of GDP) in 2011-12
Merchandise trade deficit is 130.5 billion dollars or 7.59 per cent of the GDP in 2010-11 and projected at 154.0 billion or 7.7 per cent of GDP in 2011-12
Invisibles trade surplus is 86.2 billion dollars or 5.0 per cent of the GDP in 2010-11 and projected at 100.0 billion dollars or 5.0 per cent in 2011-12
Capital flows at 61.9 billion dollars in 2010-11 and projected at 72.0 billion dollars in 2011-12
FDI inflows projected at 35 billion dollars in 2011/12 against the level of 23.4 billion dllars in 2010-11
FII inflows projected to be 14 billion dollars which is less than half that of the last year i.e 30.3 billion dollars
Accretion to reserves was 15.2 billion dollars in 2010-11. Projected at 18.0 billion dollars in 2011-12
Inflation rate projected at 6.5 per cent in March 2012.
Available food stocks to be liberally released. Important role for fiscal policy to contain demand pressure. Need to ensure that fiscal deficit does not exceed the budgeted level
RBI will have to continue to follow a tight monetary policy till inflation shows definite signs of decline
Resolve issues with states and introduce Goods and Services Tax. Reforms in power sector distribution system to limit the liabilities of state governments. (ANI)