'Policy paralysis' over, but economy still awaits 'Achche Din'

By Super
Subscribe to GoodReturns
For Quick Alerts
Subscribe Now  
For Quick Alerts
For Daily Alerts

    It was suffering from 'policy paralysis' as 2014 began with some 'green shoots' here and there, then a stable government came promising 'achche din', but the Indian economy will desperately need investments on the ground to return to its high-growth path in the new year.

     'Policy paralysis' over, but economy still awaits 'Achche Din'
    The sentiments have already got a boost -- since the formation of the new government headed by Prime Minister Narendra Modi -- and the economy can indeed grow by over 5.5 per cent in 2015 if the 'right noises' get converted into real action on various fronts including ease of doing business, experts believe.

    The factors helping in this objective include decline in inflation levels, continued boom in stock markets and expectations that RBI would also oblige with a much-awaited interest rate cut in the new year.

    After witnessing a sub-5 per cent growth, 2014 saw improvement in economic activity with the growth bouncing back to 5.5 per cent in April-September period.

    Though the year began with a low growth of 4.7 per cent in January-March quarter, momentum built up post election results in May in which BJP-led NDA won a huge majority in the Lok Sabha polls.

    While various initiatives taken by the new government in the last six months are yet to yield results, there has been a distinct improvement in the business sentiments which were reflected in the booming stock markets.

    The stock market benchmark Sensex has gained close to 30 per cent or over 6,000 points this year, recording its best rally in five years.

    In addition, the declining prices of vegetables and softening of global crude oil prices, helped in containing inflation. While the WPI-based inflation touched zero in November, the retail inflation was at 4.38 per cent, the lowest level since February 2012.

    Chief Economic Adviser Arvind Subramanian said: "There has been an improvement in economic growth as well. We were growing slow and slow for 12 quarters, that has bottomed out. And we seeing early signs of recovery, but it's not durable it hasn't taken hold yet".


    Read more about: economy
    Story first published: Wednesday, December 31, 2014, 14:22 [IST]
    Company Search
    Enter the first few characters of the company's name or the NSE symbol or BSE code and click 'Go'

    Find IFSC

    We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Goodreturns sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Goodreturns website. However, you can change your cookie settings at any time. Learn more