India economic growth outlook 2013-2014

World Economic outlook - India economic growth outlook 2013-2014 : India's economic growth hit a three-year-low in the quarter ending June 30, 2012, and a number of financial institutions cut their economic growth forecast for the country in the last quarter.

World Bank reduced india growth projection released 10 October 2012

World Economic outlook  - World Bank reduced india growth projection released 10 October 2012 : The World Bank reduced India’s growth projection to 6% in its latest economic outlook update released 10 October, the latest such cut in the country’s growth forecast. It had projected a 6.9% growth in its global economic prospects report released in June.

Indian economy Growth April-June 2012

World Economic outlook - Indian economy grew April-June 2012, inflation rate june 2012, India economy : India economy grew faster than expected in the three months to the end of June, easing some fears about a sharp slowdown in Asia's third-largest economy.

Growth was 5.5% in the April to June period from a year earlier. Most analysts had forecast a rate of 5.2%. That compares with a 5.3% annual growth rate in the previous quarter. However, there are concerns that a lack of reforms, slowing factory output and investment may hurt long-term growth.

india Interest rates expected to come down april 2012

World Economic outlook - india Interest rates expected to come down april 2012 : Finance Minister Pranab Mukherjee said he expects India’s central bank to reduce interest rates, helping revive sentiment after economic growth slowed.

“I expect policy rates to be reversed by the central bank in coming months,” Mukherjee said at a conference in New Delhi today. “That should improve sentiment.”

indian GDP growth rates revised for 3 yrs from 2008-09

World Economic outlook - indian GDP growth rates revised for 3 yrs from 2008-09 : The government is on a spree of revising macro-economic numbers. This financial year, it had first revised the wholesale price-based index and then the index of industrial production. Today, it changed the gross domestic product (GDP) numbers for three years -2008-09, 2009-10 and 2010-11.

While the new GDP growth for 2008-09 is 6.7 per cent, lower than the earlier figure of 6.8 per cent, economic expansion for 2009-10 was raised from eight per cent to 8.4 per cent and growth in 2010-11 revised from 8.5 per cent to 8.4 per cent. Last year, GDP growth for 2009-10 was revised to eight per cent from 7.7 per cent estimated earlier. As a result, economic growth for that financial year was revised from 7.7 per cent to eight per cent and now to 8.4 per cent.

Even as GDP growth was scaled down for 2010-11, in absolute terms, the size of real gross domestic product was slightly higher at Rs 4,885,954 crore from the earlier estimate of Rs 4,877,842 crore. In a nutshell, a minuscule downward impact could be seen in economic growth this financial year due to these adjustments. However, the larger picture that emerged from these numbers is both savings and investment rates showed a decline, compared to 2007-08, a pre-crisis period. The domestic savings rate declined to 32.3 per cent of GDP in 2010-11 from 33.8 per cent a year ago. In 2007-08, the rate stood at 36.8 per cent of GDP.

Similarly, capital formation fell to 35.1 per cent of GDP in 2010-11 from 36.6 per cent in the previous financial year. In 2007-08, it stood at 38.1 per cent of GDP.

“On savings rate, the news is not so good, little less. The investment rate was also scaled down a little bit. But, above 30 per cent savings and investment rate is marvelous,” said chief economic advisor Kaushik Basu. He said with the recent moderation in wholesale price-based inflation and the expected decline in the months to come, with implications for monetary policy, investment could pick up. After remaining above nine per cent for a year till November, inflation fell to 7.47 per cent in December and is projected to come down to around seven per cent by the end of this financial year. After maintaining a tight monetary stance since March 2010, the Reserve Bank of India had cut the cash reserve ratio by 50 percentage points in the last policy review.

Economists, however, are not as upbeat. “The gap in domestic savings and investment rates were filled by foreign savings then, which gives rise to a current account deficit,” said Fitch Ratings director Devendra Pant. The consumption-led growth cannot be sustained against investment-led growth, he added.

A large part of the decline in the savings rate could be attributed to the Centre's widening fiscal deficit, said economists. The Centre's fiscal deficit had declined to below initial targets. The Budget target for 2010-11 was 5.5 per cent of GDP, which was changed to 5.1 per cent in the revised estimates. However, the figure declined substantially.

For the first half of this financial year, the economy grew 7.3 per cent, against 8.6 per cent in the corresponding period of the previous financial year. The fall was evident, given the drop in the investment rate. Gross fixed capital formation in the first half of this financial year declined to 10.52 per cent. For 2010-11, it stood at 14.18 per cent. In 2007-08, it was as high as 22.17 per cent.

Though the finance ministry is optimistic that the second half would yield slightly better results, economists are not as hopeful.

Basu said, “The Outlook in the mid-year analysis was pegged at 7.5 per cent (for this financial year). We are beginning to see a turnaround. Credit growth and PMI (Purchasing Managers' Index) are showing it. Overall, I expect growth in the next financial year to be higher than that in 2011-12.”

However, the Prime Minister's Economic Advisory Council chairman, C Rangarajan, sees economic growth moderating this financial year quite a bit. “The overall growth rate in industry would be well below the initial expectations. The world economic situation is also not very encouraging.…The growth rate in the current financial year may be between seven per cent and 7.25 per cent.”

india inflation rate forecast 2012-2013

World Economic outlook - india inflation rate forecast 2012-2013 : Investment banking major Morgan Stanley has revised downwards its India’s economic growth forecast for 2012 to 7.4 per cent. Morgan Stanley reduced its forecast for India’s gross domestic product growth for 2012 to 7.4 per cent from 7.8 per cent amid high inflation and weak global capital markets environment.

IMF Mauritius economic growth forecast 2012

World Economic outlook - IMF Mauritius economic growth forecast 2012 : The International Monetary Fund cut its 2012 forecast for economic growth in Mauritius on Wednesday to 3.7 percent from 4.1 percent, citing the need for greater investment and fiscal consolidation.

Bank Sarasin indian economic forecast 2012

World Economic outlook - Bank Sarasin indian economic forecast 2012 : The Indian economy is likely to grow between 6-7 per cent in 2012, says a report by Switzerland-based Bank Sarasin.

"Sarasin expects the Indian economy to slow until mid-2012 and subsequently pick up in the second half of the year. The growth rate in 2012 is likely to be between 6 per cent and 7 per cent," it said.

indian economy forecast 2012, bnp paribas cuts india growth projections

World Economic outlook - indian economy forecast 2012,  bnp paribas cuts india growth projections : Global finance major BNP Paribas has revised downward its growth forecast for the Indian economy to 6.5 % for 2011-12, citing sliding capital expenditure and the country's exposure to European banks. It had earlier projected the growth at over 7 %. "Our FY-12 GDP forecast is cut

to 6.5 % with FY-13's 7.1 % expectation underlining that the economy will not quickly regain its prior dynamism thanks to sliding capex spending," BNP Paribas said in the latest issue of 'India Economics: Eye on the Tiger'.

Indian economic growth forecast 2012-2013

World Economic outlook - Indian economic growth forecast 2012-2013 : Several Indian and foreign brokerages are on a spree to cut India’s GDP growth forecast for fiscal years FY 12 and FY13. In the past few weeks a slew of brokerages – Maquarie, Morgan Stanley, Ambit Capital and several others have cut India’s GDP forecast for FY13 below 7%, raising worries that India will see a hard landing. On the other hand the Organisation for Economic Co-operation and Development has kept India’s GDP growth forecast at 7.2% for calendar year 2012, improving to 8.2% in calendar year 2013.

What are the reasons why growth could fall below 7%? Delay in sanctioning new projects is one reason. “This will have a spillover effect on the GDP growth in the next few quarters,” said an economist with a reputed bank. If the growth falls below 7% for the next two consecutive quarters, than there is a high possibility of FY12 growth too slipping below 7%.