India's GDP to grow by 6.9% in FY12: Govt 

The Indian economy is likely to grow by 6.9% in the ongoing fiscal year, as aggressive monetary tightening by the RBI, coupled with a bloated fiscal deficit and slowing global growth hurt domestic investments and consumer demand. The Government today released it's advance GDP estimate for the year ending on March 31, 2012. India's GDP is expected to expand by 6.9% in FY12 as against a healthy 8.4% in the last two years. The Indian economy had expanded by a modest 6.7% in FY09 in the wake of the global financial crisis. Srikant Kumar Jena, Minister of State (Independent charge), Ministry of Statistics & Programme Implementation released the advance estimates of national income 2011-12. The ‘Agriculture, Forestry and Fishing’ sector has shown a growth of 2.5% during 2011-12, as against 7% growth rate clocked in the corresponding period of last fiscal year. Growth in Mining and Quarrying is estimated at -2.2% (5%) during 2011-12 while the Manufacturing sector is estimated to grow by 3.9% during 2011-12. Construction sector is likely to expand by 4.8% in FY12 versus 8% last year. The GDP growth rate of 6.9% during FY12 has been due to an 8% growth rate in ‘Electricity, Gas & Water Supply’, 'Trade, Hotels, Transport & Communication`, and 'Financing, Insurance, Real Estate and Business Services'.

India's GDP growth in the April-September 2011-12 period stood at 7.3%. That means that growth will moderate in the second half of the current fiscal year. The CSO's GDP growth projection is lower than the 7% GDP forecast made by the Reserve Bank of India (RBI) in its quarterly monetary policy review last month. In its mid-year Economic Review, the Government had pegged FY12 GDP growth at around 7.5%. The CSO's advance estimate for FY12 GDP growth is also sharply lower than the 9% growth projection announced by the Government in February 2010. Commenting on the advance GDP growth estimates, Planning Commission Deputy Chairman Montek Singh Ahluwalia said today, "The 6.9% growth is consistent with what we have been saying. "We said 7% for year (2011-12) as whole. (With) 7.3% in the first half and 6.9% in the third quarter, 7% is possible," he said. The GDP growth at market prices during FY12 is estimated at 7.5% compared to 9.6% in 2010-11. Private final consumption expenditure is estimated to show a growth rate of 6.5%. Gross Fixed Capital Formation, which is an important indicator of investment in the economy, is estimated to grow by 5.6%.

FM hopes for upward revision in FY12 GDP growth

CII expects 8% growth path: Chandrajit Banerjee

India's industrial output growth slumps again

India's industrial production decelerated in December after posting a smart rebound in the previous month, as aggressive rate hikes by the RBI and policy impasse at the Centre hit investments and consumer spending. However, there is a school of thought which believes that the disappointing December IIP numbers could force the RBI to ease its hawkish monetary policy sooner rather than later. The factory output, as measured by the index of industrial production (IIP), grew by 1.8% in December as against 5.9% in November, data released by the Commerce Ministry showed. Industrial production had expanded by a healthy 8.1% in December last year. Industrial output in the April to December 2011-12 period grew by 3.6% compared to the expansion of 8.3% in the corresponding period a year earlier.

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