The Indian economy will grow at 8.5-9 per cent this fiscal despite a slowdown
in industrial growth in July, Montek Singh Ahluwalia, deputy chairman of the planning
commission, has said.
have been predicting a slightly lower growth and the latest industrial output
numbers are no reason to reassess the growth estimate," Ahluwalia told reporters
on the sidelines of a meeting on ground water management.
said while growth in the first quarter was good, some slowdown in the second quarter
was expected. "I would rather call it a moderation in growth rather than
slowdown," he said.
discounted the slowing effects of a tight money policy on the economy. Rather,
he said, the Reserve Bank''s policy was "a successful example of macro economic
management, consistent with extracting non-inflationary potential of the economy
by maintaining growth."
the economy grew at 9.3 per cent in the first quarter of the current fiscal, industrial
growth slipped to 7.1 per cent in April-July from 13.2 per cent in the same period
a year ago.
analysts attribute the slowdown to higher interest rates, which forced consumers
to cut spending on household items and automobiles, adversely affecting the manufacturing
sector growth came down to 7.2 per cent during the month as compared to 14.3 per
cent in July 2006.
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