PMEAC pegged India’s Growth at 6.7 Percent in the Fiscal Year 2012-13

According to the Economic Outlook 2012-13 released by Prime Minister Economic Advisory Council on 17 August 2012, India’s economy will grow at 6.7 percent in the financial year 2012-13. India economy had registered 6.5 percent growth in the fiscal 2011-12, which was the lowest in the past nine years.

The council also raised the projection for inflation to about 6.5 – 7 percent from earlier 5 – 6 percent.

The government’s fiscal deficit is expected to go up to 6 percent in the financial year 2012-13 as compared to 5.8 percent in the previous fiscal.

The current account deficit of the government pegged at 67. 1 billion dollar (3.6 percent of GDP).

Reserve Bank of India (RBI) had earlier lowered its growth projection for 2012-13 to 6.5 per cent from 7.3 per cent estimated earlier. Other global agencies had also cut their growth forecast for Indian economy on the account of paralyzed policy reforms, high policy rates and weak monsoon.

The PMEAC in its report advised the government to take some concrete measures to reverse the pessimistic economic environment in the country.  To accelerate the stalled reform council Chairman C Rangrajan urged the government to open multi-brand retail to foreign investment. It also recommended the government to raise diesel prices in one or more steps to moderate the widening fiscal deficit.

GDP Growth - Actual & Projected At constant 2004/05 prices