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New Delhi: Chief Economic Advisor (CEA) KV Subramanian said on Wednesday that India would record annual growth of more than 7% in this decade on the basis of strong economic fundamentals. In the current fiscal year, he said, growth would be double digits and could moderate to 6.5-7% in the next fiscal year.
Economic Survey 2020-21, released in January of this year, forecast GDP growth of 11% in the current fiscal year ending in March 2022.
The survey had indicated that growth would be supported by the push on the supply side of reforms and the relaxation of regulations, investment in infrastructure, stimulation of the manufacturing sector through incentive programs linked to production (PLI), the recovery of pent-up demand, the increase in discretionary consumption thereafter. the deployment of vaccines and the recovery of credit.
“When you look at the data itself in fact, the V-shaped recovery and quarterly growth patterns have actually established that the fundamentals of the economy are strong … year, but also in the future, “he said.
Growth will be aided by various structural reforms, including labor and agricultural laws, undertaken by the government, he said at a virtual event hosted by the US-India Strategic Partnership Forum (USISPF ).
“This decade will be India’s decade of inclusive growth. In FY 23, we expect growth to be between 6.5% and 7%, and then to accelerate further as the impact of these reforms is visible. On average, I expect the growth to be greater. by 7% during this decade for India, â€he said.
He also pointed out that the government places a lot of emphasis on capital spending as it has a multiplier effect.
The Union budget for 2021-22 provides for a down payment of Rs 5.54 lakh crore, an increase of 34.5% compared to the budget estimate for 2020-21.
The budget estimate for capital expenditure for fiscal year 2020-21 was Rs 4.12 lakh crore.
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The outlook for the sovereign rating is negative. During Tuesday’s meeting, finance ministry officials highlighted the upward trajectory of GDP growth seen in the June 2021 quarter as well as the budget deficit and the number of borrowing.
An acceleration in COVID-19 vaccination, healthy advance estimates of the kharif (summer) harvest and faster government spending were the factors that led to the review, the agency said in a statement.
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