Encouraged by the high industrial output in December, Planning Commission on Friday hoped that the country would register over 8 per cent economic growth next fiscal as against the 7.2 per cent expected in 2009-10.
“I hope that we are well positioned for next year that is fiscal year 2010-11 to have a GDP growth of over 8 per cent,” Commission Deputy Chairman Montek Singh Ahluwalia told reporters.
“We thought it (industrial growth in December) might be 13 per cent. It is now just under 17 per cent, so the performance is very much in the direction that we expected of a good revival,” he said.
The Index of Industrial Production (IIP) grew 16.8 per cent during December, against 0.2 per cent contraction during the corresponding month a year ago.
When asked whether the trend of high industrial growth would continue, Mr. Ahluwalia replied, “When you transit from a period of flat or very low output to recovery then for some months the growth rates are very high and then they stabilise again to a normal level.”
He added that, “I do not expect 17 per cent growth in industry to continue month after month that is for sure. So, my hope is that next year we will show a double-digit growth in the industry”.
About the Central Statistical Organisation’s (CSO) projection of 7.2 per cent economic growth for the current fiscal, he said: “It is possible that there could be upward revision of the CSO’s GDP growth estimates for this fiscal. CSO data indicates that our growth would be over seven per cent.”
Finance Minister Pranab Mukherjee too said that the December IIP figures will have a positive bearing on the economic growth figures for the current fiscal.
“It (IIP growth rate in December) is quite encouraging and I do hope that third quarter GDP figures will also be encouraging... it will get reflected in the overall GDP,” he said while talking to reporters here.
Moreover, the advance growth estimate by CSO, was lower than the 7.75 per cent projected by the Finance Ministry and 7.5 per cent predicted by the Reserve Bank of India.