A survey of Reserve Bank of India has painted a dim picture of India’s growth rate forecasting the Gross Domestic Product (GDP) rate to 5.7% for the current fiscal year (April 01, 2009 to March 31, 2010) as against the previous projection of 6%.
The survey has also forecast a downward projection of India’s GDP for the next 5 years to 7% and for the next 10 years to 7.5% while the RBI had earlier estimated the growth rate to 8.8% for the next 10 years.
However, the apex bank has also stated that this forecast reflects the inference coming out from the survey, and it is not the RBI’s forecast.
The master bank had conducted a survey among 17 professional forecasters, including the World Bank who forecast on India’s GDP growth, inflation, savings, capital formation, consumption expenditure, export, import, interest rates, money supply, credit growth, stock market movements, corporate profit, etc.
In order to conducting the survey, the RBI had sent a questionnaire to 40 agencies in which 17 professional agencies participated. Since September 2007, the Central Bank has been continuously conducting the survey and also posts the results on its official website.
According to survey, all the 17 agencies have forecast a similar growth rate in the country’s farm as well as service sector respectively to 3% and 7.5%.
In merchandise exports, it (the survey) projected a sharp slump of 4% to $169-billion from the set target of $200-billion.
The saving rates and capital formation – the essential factor for reforming the infrastructure – have also been forecast lower to 34.6 percent from 35.3 percent, and 32 percent from 37.5 percent respectively.
The inflation for the first quarter of this fiscal has been predicted to (-)1.4 percent in first quarter and 5-5.9 percent for whole year.
The growth in corporate profits plummets to 9 percent this fiscal from a still healthy 13.5 percent while the fiscal deficit has been projected to swelled 6.8% for this fiscal from 6.2% of previous year.
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