New Delhi: Consultancy firm Dun & Bradstreet has projected India’s economy to grow by 8.3% next fiscal against an estimated 7.2% in the current fiscal, but said inflation will remain a concern and touch double digits in early 2010-11.
“We expect GDP growth to be around 8.3% during FY11 backed by strong investment as well as consumption demand,” Yashika Singh, head, Economic Analysis, Dun & Bradstreet (India) said.
The aggressive measures taken by the government to tackle the economic crisis has put the country on a strong recovery path, it said.
D&B, however, cautioned some downside risks to the economy in the form of inflation.
Inflation rose by 1.33% in February to 9.89%, surpassing the RBI target of 8.5% by March end.
“Inflation is expected to remain at double-digit levels in the first few months of FY11,” Singh said.
The consultancy firm said the industrial sector is likely to play major role in driving the economic growth next fiscal.
“IIP growth is expected to remain robust at 10.3% during FY11. Focus on infrastructure spending by the government and an increase in investment demand by the corporate along with improved consumption would provide impetus to the industrial production,” she added.
For the fifth consecutive months, India’s industrial growth stood at double digits, 16.7%, in January on robust manufacturing activity, lending optimism of a faster economic recovery.
Finance minister Pranab Mukherjee had earlier exuded confidence that the economy would grow more than 8% next fiscal.
The Economic Survey, tabled in Parliament in February, had said the economy could grow up to 8.75% during the 2010-11 from an estimated 7.2% in the current financial year.
D&B said the RBI might take some measures aimed at arresting the mounting inflationary pressure, though in a calibrated manner without affecting growth.
On Friday, RBI raised short term lending and borrowing rates, Repo and Reverse Repo, by 25 basis points to tame inflation. The RBI is also expected to further squeeze money supply in its 20 April monetary policy review for 2010-11.