Indian economy: preparing for a delayed take-off
The govt needs to urgently push for investment and growth while managing expectations over the next four months
The World Bank recently raised India’s gross domestic product (GDP) growth rate for 2014-15 to 5.6%. Various forecasters have predicted the growth rate for 2014-15 that varies around this mark. Our annual mid-year review of the economy shows that the real GDP growth rate for 2014-15 may be around 5.0 %, and could even be lower if downside risks are borne out. Another year of sub 5% growth, the third in succession, could drive down economic sentiment dramatically. An expectation management effort is essential now as an insurance against the downside risks faced by the economy.