The Reserve Bank on Friday said the economy would grow by 5 to 5.5 per cent in the current fiscal, pinning its hopes on good farm output and improved exports.
“We have no reason to dispute the growth rate projected by the government at 5 to 5.5 per cent,” RBI Governor Raghuram Rajan told reporters after a board meeting here. He based his optimism on expectations of a good kharif crop, improvement in exports and core sector performance data.
“...First estimate of kharif crop is significantly above the first estimate of last year. I think if we see some pick-up in exports...Core sector is improving in performance. We would hope we would reach that range of 5 to 5.5 per cent,” he said. India’s economic growth rate slipped to a decade low of 5 per cent in 2012-13 and declined to 4.4 per cent in the first quarter (April-June) of the current financial year.
The ADB on October 2 lowered its growth projection for India in the current fiscal to 4.7 per cent from an earlier estimate of 6 per cent. It said the country’s economy has been under pressure with the recent depreciation in the rupee and capital outflows adding to structural constraints.