Pinning hopes on higher farm growth in view of a good monsoon spell, Planning Commission Deputy Chairman Montek Singh Ahluwalia on Wednesday said the economy is likely to grow at 5.5 per cent this financial year.

“It will be a good year for agriculture but there is no evidence yet of significant turnaround in industry. I guess that better, good outcome for India will be that India will do better than last year, better than 5 per cent, may be 5.5 per cent (this fiscal),” Mr Ahluwalia told reporters.

The government has initially projected a growth rate of 6.5 per cent for the current fiscal, but has lowered it in view of global and domestic factors.

RBI recently in its quarterly review has scaled down the growth projection for the current fiscal to 5.5 per cent from its earlier estimate of 5.7 per cent and asked the government to undertake policy measures to improve investment climate.

The RBI in its annual policy in May had projected the economy would grow at 5.7 per cent.

The country’s economic growth hit a decade low of 5 per cent in the last fiscal on account of poor performance in the farm, manufacturing and mining sectors.

Last month, the Asian Development Bank lowered its growth projection for India to 5.8 per cent in calendar 2013 from 6 per cent estimated earlier, citing the slow progress of economic reforms.

International Monetary Fund outlook projects India’s economic growth at 5.6 per cent this year.

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