India lowers 2012-13 growth forecast to 5 percent
New Delhi, Feb 7 : The Indian economy this fiscal would grow at a sharply lower rate of 5 per cent, lowest in a decade, due to poor performance of agriculture, manufacturing and services, according to government estimates released Thursday.
In 2002-03, the Gross Domestic Product (GDP) had grown at 4 per cent.
"The growth in GDP during 2012-13 is estimated at 5 per cent as compared to a growth rate of 6.2 per cent in 2011-12," said an official release quoting advanced estimates released by the Central Statistical Organisation (CSO).
The estimates lowered the growth in agriculture and allied activities to 1.8 per cent in 2012-13, compared to 3.6 per cent 2011-12.
The figure is much lower than the government and the Reserve Bank projections of 5.9 and 5.5 percent respectively. In fiscal 2011-12, the economy had grown at 6.2 percent.
C. Rangarajan, chairman of the Prime Minister's Economic Advisory Council, found the data "disappointing" but said the final figure could still be higher than currently forecast.
"It can be revised upward," he said.
The data showed that agriculture, manufacturing, electricity generation and mining were the major drags on the economy.
"Agriculture, forestry and fishing is estimated to grow at only about 1.8 percent from 3.6 percent, while manufacturing stands to increase marginally by 1.9 percent from 2.7 percent and electricity, gas and water supply will inch further only by 4.9 percent from last fiscal's growth rate of 6.5 percent."
The growth in the mining and quarrying sector is estimated to recover by 0.4 percent from last fiscal's negative 0.6 percent deceleration.
The estimated growth in GDP in service sectors such as trade, hotels, transport and communication sectors is placed at 5.2 percent from a growth of 7.00 percent in the previous fiscal.
The service sectors like financing, insurance, real estate and business services is expected to show a growth rate of 8.6 percent from an increase of 11.7 percent in 2011-12.
Growth has slumped in recent quarters due to the lingering uncertainties in the global economy and domestic policy inaction. The country's GDP has expanded by just 5.4 percent in the first half of 2012-13.
The finance ministry said in the report that growth was likely to improve in the second half the current financial year and it would remain between 5.7 and 5.9 percent.
"It should be possible for the economy to improve the overall growth rate of GDP to around 5.7 percent to 5.9 percent for the year 2012-13," the report said.