largely by services and manufacturing, the economy is
expected to grow 9.2 per cent 2006-07 India's highest
since the government introduced economic reforms.
Cebtral Statistical Organisation (CSO), in its official
growth estimate for 2006-07 said manufacturing output
growth was estimated at 11.3 per cent compared with 9.1
per cent a year ago.
economic growth estimate is higher than the Reserve Bank
of India's forecast of between 8.5-9.0 per cent. Last
week the growth rate was revised to 9.0 per cent from
the previous target of of 8.4 per cent.
has averaged 8.3 per cent over the past three fiscal years,
straining infrastructure and leading to a squeeze on capacity,
which is fuelling inflation.
current growth is backed by strong investments, exports,
and consumption. In fact consumption growth has led to
a credit growth of 30 per cent, which in turn has resulted
in inflationary pressures, and to cool it the RBI has
been tightening liquidity.
are fears that the tightening the liquidity could also
curb new investment, moderating growth in FY 2007-08.
The RBI raised its key lending rate last week to 7.50
percent, a four-year high, following four increases in
2006 to cool inflation.
minister Dr Manmohan Singh has said farm output must grow
close to 4 per cent on a sustained basis to ensure GDP
increases by 7.0-8.0 per cent annually over the next few