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With the revival in investments and consumption demand, the Indian economy is expected to grow between 6.5-6.9% in fiscal year 2010, however inflation may rise, said an economic think-tank.
The National Council for Applied Economic Research (NCAER) said though the external environment is not very favorable for the economy to grow but continuing lower petroleum prices and revival of investment and consumption demand can definitely boost economic growth.
For 2008/09, it has maintained its initial forecast of GDP growth at 6.5 percent.
NCAER is of the say that the fiscal stimulus can give impetus to the economy resulting in a growth rate 6.9 percent in the current fiscal while industry could grow by 6.3 percent and service sector at 8.5 percent.
Agricultural growth is expected to be 2.5 percent in 2008-09, it said adding that the additional stimulus package could lead to rise in fiscal deficit to 4.5 percent of GDP.
Despite "weak external demand and dropping supply of investment funds", the Delhi-based economic think-tank is expecting Indian exports to grow at 9.1 percent and imports at 10 percent in the current fiscal. Reuters
April 29, 2009
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