8% Growth for the future possible

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Panagariya sees growth at over 8%

By The Times of India.

The Indian economy is expected to grow over 8% in the current financial year as the momentum has started gathering pace, NITI Aayog vice-chairman Arvind Panagariya said on Friday. "We will cross 8% economic growth. The 7% economic growth in the first quarter will be revised upwards," he said, emphasizing that things are now moving on economy front.

In the first quarter of the current financial year (April-June), the economy grew at 7%, down from 7.5% in the preceding three months mainly on account of deceleration in farm, services and manufacturing sectors. It was, however, 6.7% in the corresponding quarter a year ago.

Panagariya's comments come a day after the World Bank projected India's growth to be below 8% over the next three years even when investments in the country grow by 8.8% during the three year period up to 2017-18.  

"The latest India Development Update expects India's economic growth to be at 7.5% in 2015-16, followed by a further acceleration to 7.8% in 2016-17 and 7.9% in 2017-18," World Bank said in a report released earlier this week. Panagariya was optimistic about the prospects of the economy.

"The picture will be more clear when we will get the second quarter GDP data by the end of November. The investments are up during the first half of this fiscal which reflect buoyancy in the economy. The numbers are even more than that of China,'' he said.

Earlier this month, the International Monetary Fund (IMF) too projected a slight drop in India's growth rate from 7.5% to 7.3% in 2015. The multilateral body, however, retained its growth projection for 2016 at 7.5%.

The economic survey released by the finance ministry in February had set growth target of 8.1 to 8.5% for the current fiscal year.

However, the Reserve Bank of India (RBI) in its monetary policy review last month lowered the GDP growth forecast to 7.4% for the current fiscal from 7.6%. Economy grew 7.3% in the previous fiscal year compared to advance estimates of 7.4% by the Central Statistics Office.