20.11.13

Indian Economy to grow @ 3.4% : OECD


Organisation for Economic Co-operation and Development (OECD), the Paris-based think tank has projected that the Indian economy will grow at 3.4% in the current financial year (based on market prices), a marginally better show than last year’s 3.3%.
Based on market prices, the Indian economy is estimated to have expanded at less than 3% over the first half of last year (around 4.5% at factor cost). But going forward, it is expected to gain momentum as exports recover and the projects being cleared by the Cabinet Committee on Investment get back on track, OECD said in its latest Economic Outlook. What is expected to add to the improved conditions is the end of political uncertainty after the 2014 general elections, it added.
“Activity is projected to rise gradually over the next two years but, as supply rigidities bind, growth will remain well below rates observed in the second half of the previous decade,” the report said. It pegged growth at market price at 5.1% in 2014-15 and 5.7% in 2015-16.
The government goes by the estimates at factor cost, and is estimating that the economy will grow at 5-5.5% this fiscal, compared to 5% last year. Recently, IMF had projected that the Indian economy would grow at 3.8% (at market price), a forecast that came under intense criticism by the FM.

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