GDP forecast revised to 6.9% against 8.4% last year

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GDP forecast revised to 6.9%
Government estimates economy to grow by 6.9% in 2011-12 against 8.4% last financial year, the steep fall is due to slowdown in manufacturing, agriculture and mining sectors.

Gross domestic Product (GDP) which refers to the market value of all final goods and services produced within a country in a given period.

According to Advanced Estimates released today by the Central Statistical Organisation (CSO), Agriculture and related are expected to grow by 2.5% current fiscal year, where as last year in 2010-11 it was at 7%.

Manufacturing growth is also estimated to slip to 3.9% in this fiscal from 7.6% last year. Growth in construction may also dip to 4.8%, against an 8% in 2010-11.

According to the CSO, mining and quarrying may decline to 2.2%, whereas last year it had growth of 5%.
The finance, insurance, real estate and business services sectors are expected to grow by 9.1% this fiscal, against 10.4% a year ago.

Reserve Bank of India last month forecast that GDP growth projection will be around 7%. The current estimate is a sharply lower than the 9% growth projection for 2011-12 made by the government in its pre-Budget survey in February last year, reports PTI.

Commenting on the GDP growth estimates, Planning Commenting on the GDP growth estimates, Planning Commission Deputy Chairman Montek Singh Ahluwalia said: "The 6.9 per cent is consistent with what we have been saying. "We said 7 per cent for year (2011-12) as whole. (With) 7.3 per cent in the first half and 6.9 in the third quarter, 7 per cent is possible."

Electricity, gas and water production is, however, likely to be better this year. The segments are expected to grow up by 8.3% in 2011-12, against 3% in 2010-11.

During the current fiscal, the trade, hotel, transport and communication sectors are projected to grow by 11.2%, against 11.1% last fiscal.

The government and the RBI had earlier said that global economic slowdown and the high domestic interest rate regime is likely to act as a dampener in this fiscal's growth.
Sources from PTI

Read more about: government, gdp, economy, rbi
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