Dun & Bradstreet pegs 2014 growth at 5.5%

Business

oi-Staff

By Super

Published: Saturday, December 28, 2013, 11:33 [IST]

Mumbai: Recent decisions on the policy front are expected to help push up economic growth to 5.5 percent next year from 4.8 percent estimated for 2013-14, Dun & Bradstreet said Friday.

"Growth will recover, albeit moderately, during 2014 on improved policy environment, projects cleared by the Cabinet Committee on Investment, expectations of receding inflationary pressures along with some revival in demand conditions," the global research firm said in a note.

The jump in growth will come in the second half of the year as the effect of the policy decisions takes place, it added.

The report said GDP growth in 2013 will come in at 4.8 percent, down from 5.1 percent last year.

It can be noted that the GDP growth increased to 4.8 percent for the quarter ended September from the 4.4 percent earlier, making the half year average a poor 4.6 percent.

The government is estimating it to touch 5 percent this fiscal ending which is way below the potential growth rate. D&B said due to a deterioration in private demand, significant dip in investments and increase in the number of stalled projects worth over Rs 17 trillion it expects the industrial sector to grow only at 1.9 percent in 2013, which it sees growing to 3 percent in 2014 on revival in investments and uptick in sentiment.

On the services sector front, it expects 2013 growth to be at 6.5 percent, which will accelerate to 7.2 percent in 2014 on improvement in global conditions.

Inflation, which has been one of the primary concerns preventing RBI from easing its policy rates, will cool to an average of 5.8 percent in 2014 measured by wholesale prices as against the 6.4 percent expected in 2013, it said.

PTI