With the global “economic winter” far from over, the United Nations Conference on Trade and Development (UNCTAD) today projected a lower growth for India in 2009, compared with official projections.
In contrast to official and Reserve Bank of India (RBI) forecasts of above six per cent in the current fiscal, the UNCTAD’s Trade and Development Report, 2009, expects the Indian economy to expand by only five per cent in 2009. The economy grew by 6.7 per cent in the financial year 2008-09. In the first quarter of the 2009-10 fiscal, the Gross Domestic Product expanded at 6.1 per cent and both the the RBI and the Prime Minister’s Economic Advisory Council expect GDP to be above six per cent for 2009-10.
However, despite projecting a lower growth rate, the UNCTAD report lists India as the second fastest growing economy after China. The global economy is set to shrink by 2.7 per cent in 2009.
“The economic winter is far from over: tumbling profits in the real economy, previous over-investment in real estate and rising unemployment will continue to constrain private consumption and investment for the foreseeable future,” it said.
“Even economies that will grow this year, such as those of China and India, are slowing significantly compared to previous years,” it said, adding crisis is “unprecedented in its depth and breadth” leaving virtually no country unscathed, it said.