With concerns being voiced over slowing down of economic growth amid rising interest rates regime, Union Finance Minister Pranab Mukherjee on Monday said the government had not taken any concrete decision on revising the economic growth projections for 2011-12.
Asked if the government was planning to revise the GDP growth projections downwards, Mr. Mukherjee said no decision had been taken as yet. In the annual Economic Survey, the government had projected GDP growth to be somewhere between 8.75 per cent and 9.25 per cent this fiscal.
However, in its monetary review for the fiscal, the Reserve Bank of India pegged the GDP growth at 8 per cent, lower than the 8.5 per cent recorded in the previous fiscal. The RBI has been holding a view that controlling inflation is top priority, even at the cost of growth. The central bank has hiked the key policy rates ten times since March 2010 in its bid to check price rise.
The hard interest rate regime had seen the industrial production growing by 6.3 per cent in April compared to an over 16 per cent growth in the year-ago month, prompting analysts to say that probably economy is slowing down.
Global ratings agency Fitch has also lowered its growth forecast for India in 2011 to 7.7 per cent from 8.3 per cent previously. The Fitch report says the economic outlook is likely to remain somewhat clouded by persistently high inflation.
Last week in Washington, Mr. Mukherjee had said the Indian economy was likely to maintain the growth momentum of the previous fiscal in 2011-12 as well. In 2010-11, the economy is estimated to have expanded at 8.5 per cent.