New
Delhi: According to a Assocham survey of chief executives
and chairman and managing directors, the Indian economy
is not overheated and has the capacity to absorb 8 to
9 per cent growth for a long period.
According
to the Assocham Business Barometer (ABB), 74
per cent of the 280 CEOs and CMDs surveyed from different
segments of industry believed the economy was not stretched.
However,
69 per cent felt continuous caution was required to
maintain macro-economic stability so as to maintain
pick-up in investment and growth on a sustained basis.
While
inflation remained an area of concern for the government
and the policy-makers, the root of the inflationary
problem was in the hardening of primary commodity prices.
The
contribution of the primary articles with a weight of
22.03 per cent in the WPI basket was 28.8 per cent in
the 34 weeks until November 18. Major contribution to
inflation was made by cereals; pulses; potatoes, milk,
condiments and spices and minerals, the chamber said.
Over
88 per cent of the respondents said in the short-term,
the supply of the primary products could be augmented
by measures like reduction in customs duty and improving
production of these essential commodities by giving
a boost to agriculture.
However,
21 per cent of the respondents did express fear of the
economy
getting overheated. They argued that besides the mounting
problem of inflation, the mismatch between investments
and savings could lead to the problem of overheating.
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