Macro outlook brightens, but threats remain

Last week, the Asian Development Bank revised upwards its forecast for India’s growth in 2009-10 by 1 percentage point to 6%, joining a growing list of optimists who believe the global economy has turned the corner. A bird’s-eye view of the economy shows key macroeconomic indicators such as economic and industrial growth have begun to rise recently. Threats, however, remain. Inflation, perhaps the most politically sensitive economic indicator, could spoil the show. While the Wholesale Price Index (WPI) has only just turned positive, consumer rices have been rising. Of late, consumer price indices have flared up on account of food getting costlier. The macro snapshot showcases the positives, worries and threats to the economy in the near future. The snapshot is accompanied by broad policy priorities identified by finance minister Pranab Mukherjee and others.