New Delhi: Finance minister Pranab Mukherjee on Wednesday pegged 2009-10 economic growth at around 7.75%, higher than the government’s forecast
The minister said an annual 7.9% expansion in July-September, the fiscal’s second quarter, had boosted optimism.
“The growth outlook for the next two quarters and for the whole year is expected to be in the upper-bound range of most predictions for the Indian economy,” he said.
Mukherjee’s projection is in line with the central bank’s growth forecast, but is higher than the Central Statistical Organization’s (CSO) advance gross domestic product growth forecast of 7.2%.
Economists said the finance ministry and the central bank seem to be betting on better-than-expected growth in the final two quarters of the fiscal. CSO’s forecast, released on Monday, will be revised in June.
India has been picking up momentum, powered by industrial output that is expected to have risen an annual 12% in December.
The stronger growth is expected to allow the government to start rolling back fiscal stimulus measures that were put in place when the global economic crisis erupted in 2008.
The debt market did not react to Mukherjee’s forecast, as other policymakers, including Prime Minister Manmohan Singh, have announced the number several times before.
Earlier this month, the International Monetary Fund forecast growth in 2009-10 at 6.75%.