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Economy likely to grow at 8-8.5% in FY12: Deputy Chairman
May, 13th 2011

The Planning Commission today said the economy could expand by 8-8.5% this fiscal, but may not be able to achieve 9% growth under the current circumstances.

"I would definitely say 9% economic growth in 2011-12 does not look feasible. But anything above 8% would be pretty good by any standard," Planning Commission Deputy Chairman Montek Singh Ahluwlia told reporters here.

He said, "I think lowering (economic growth target) from 9% is very reasonable. RBI has actually lowered it to 8%. I think it could be better than 8% and 8.5% is not an unreasonable expectation."

Referring to Finance Minister Pranab Mukherjee's recent statement that the growth projection of 9% was made in January, Ahluwalia said, "since January there are many developments across the world and also there was some slowing down in the pace of industrial growth."

On the industrial growth numbers for March, he said, "(industrial growth of) 7.8% (in 2010-11) is not a big surprise.

It is roughly what we thought it would be. The important thing is that the monthly number have shown a significant improvement and that is very welcome."

The industrial growth has improved to 7.3% in March compared to 3.6% in February this year.

Referring to the moderation in food inflation to a 18-month low of 7.7%, Ahluwalia said, "Softening is something which we have expected...I do think that the inflation is on its way down."

Going ahead, he added, "I am hopeful that it (average inflation for 2011-12) may be around 6%."

 
 
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