Growth rebound on radar - The Telegraph - Calcutta Telegraph

New Delhi, April 23: India's economy can pick up and grow 6.4 per cent in the current fiscal, a report prepared by the Prime Minister's Economic Advisory Council (PMEAC) said today. "I believe we have reached the bottom, the economy will now continue to grow at a faster rate," PMEAC chairman C. Rangarajan said, while releasing the panel's review of the economy. The economy grew 5 per cent in the last fiscal, fuelling concerns over flagging demand and investment. "The very high level of investment that we have even now gives us the hope that if we take action for speedy implementation of projects, we can achieve the higher rate of growth quickly even in the short term," Rangarajan said. The government was blamed for policy paralysis and red tapism, which stalled investments and slowed down the economy last fiscal. However, in the latter part of the year, it took reform measures such as opening up the retail sector to foreign investments, allowing foreign airlines to invest in Indian carriers and setting up the cabinet committee on investments to fast-track big-ticket projects. Rangarajan's projections of higher growth rest in part on an uptick in manufacturing and farm growths. The manufacturing sector is projected to grow 4 per cent against 1.9 per cent last year, while agriculture and allied sectors are likely to grow 3.5 per cent this fiscal on the back of normal monsoon against 1.8 per cent last year. "We have also indicated that there were several actions that needed to be taken in order to ensure that we achieve this higher rate of growth," Rangarajan said. The panel's report advised the government to speed up project clearance and facilitate new investments. The report flagged meeting investment and production targets in coal, power, roads, railways and ports as the key. The former RBI governor said the country's unfavourable current account deficit (CAD), or the gap between foreign exchange earnings and spending, was a matter of concern. CAD is likely to narrow down to 4.7 per cent of GDP in the current fiscal from an estimated 5.1 per cent last year, Rangarajan said. The report sought the lowering of subsidies on fuels to cut the growing appetite for costly energy imports and steps to encourage more exports of goods and services. via Business - Google News http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNEaF4F84dXQzqGyPazIQ1Z0Wj-XoQ&url=http://www.telegraphindia.com/1130424/jsp/business/story_16820147.jsp

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