Encouraged by a robust 16.7 per cent industrial output in January, Finance Minister Pranab Mukherjee today said the economy is on the path of fast recovery and will end the fiscal with a growth rate of 7.2 per cent as projected by the Central Statistical Organisation.
"Signal is quite clear and it is encouraging. I do hope it will be possible for us to achieve the growth (rate) which has been projected by the advance estimate of CSO," he said.
According to the Central Statistical Organisation (CSO) data, released earlier in the day, Index of Industrial Production (IIP) grew by 16.7 per cent in January against just a per cent during the corresponding month in 2009. The IIP growth was 17.6 per cent in December.
"For the two consecutive months, there has been a high growth. Perhaps it indicates that the manufacturing sector is going to make its substantial contribution to growth and it(growth) is on the path of fast recovery," he said.
"As a conservative person, I will like to wait for another month's figure," Mukherjee said, adding that the signals were positive.
The CSO has projected a growth rate of 7.2 per cent for 2009-10, but analysts feel it may be a tough target to achieve because of the less-than-expected 6 per cent growth the third quarter ending December.
The growth rate was 6.1 per cent in first quarter (April-June) and 7.9 per cent in the second quarter (July-September).
Manufacturing, which has around 80 per cent weight in the Index of Industrial Production--a measure of factory output in the country--rose by 17.9 per cent in January against just one per cent growth a year ago.
Within manufacturing, capital goods surged by 56.2 per cent against 15.9 per cent a year ago.
The consumer durables segment zoomed 31.6 per cent against 2.1 per cent in January last year.