Here are the highlights:–
- Indian economy is estimated to grow by 6.9% in 2011-12 mainly due to weakening industrial growth. The Economic Survey 2011-12, however predicts 7.6% GDP growth in 2012-13 and 8.6% in 2013-14. India remains one of the fastest growing economies of the world as all major countries including the fast growing emerging economies are seeing a significant slowdown.
- The services sector’s share in GDP has climbed from 58% in 2010-11 to 59% in 2011-12 with a growth rate of 9.4%. Agriculture and allied sectors are estimated to achieve a growth rate of 2.5% in 2011-12. The industrial sector has performed poorly, retreating to a 27% share of the GDP. Overall growth during April-December 2011 reached 3.6% compared to 8.3% in the corresponding period of the previous year.
- Inflation as measured by the wholesale price index (WPI) was high during most of the current fiscal year, though by year end there has been a clear slowdown in price rise.
- Monetary policy was tightened by the Reserve Bank of India (RBI) to control inflation and curb inflationary expectations.
- The Economic Survey expects the growth rate of real GDP to pick up to 7.6% in 2012-13 and faster beyond that.
- Gross capital formation during the third quarter of 2011-12 as a ratio of GDP was at 30%, down from 32% one year ago.
- Preliminary calculations suggest that the growth rate of GDP in 2013-14 will be 8.6%. These projections are based on assumptions regarding factors like normal monsoons, reasonably stable international prices, particularly oil prices, and global growth somewhere between where it now stands and 0.5% higher .
- The Economic Survey suggests that the progressive deregulation of interest rates on savings accounts will help raise financial savings and improve transmission of monetary policy.
- Other key areas include the deepening of domestic financial markets, especially corporate bond market and attracting longer-term inflows from abroad.
- Efforts at attracting dedicated infrastructure funds have begun.
- India’s foreign trade performance will remain a key driver of growth. During the first half of 2011-12, India’s export growth was a high 40.5%, but has been decelerating since. Imports have growth rapidly, by 30.4% during 2011-12 (April-December).
- Similarly, country’s Balance of Payments has widened to $ 32.8 billion in the first half of 2011-12, compared to $29.6 billion during the corresponding period of 2010-11.
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