By IANS,
New Delhi : Following are the highlights of the observations and forecasts on the performance of the Indian economy made by the Prime Minister’s Economic Advisory Council, chaired by C. Rangarajan, here Friday:
-Economy to grow at 8.5 percent in 2010-11 and 9.0 percent next fiscal
-Agriculture to grow at 4.5 percent in 2010-11 and 4 percent next fiscal
-Industry to grow at 9.7 percent in 2010-11 and 10.3 next fiscal
-Services to grow at 8.9 percent in 2010-11 and 9.8 percent next fiscal
-Rising domestic savings and investment chief engines of growth
-Investment rate expected at 37 percent in 2010-11 and 38.4 next fiscal
-Domestic savings expected at 34 percent in 2010-11 and 36 percent next fiscal
-Capital inflows projected at $73 billion for 2010-11 and $91 next fiscal
-Inflation rate projected at 6.5 percent by March 2011
-Controlling high inflation rate essential for sustainable growth in medium term
-Bias toward tightening monetary policy is necessary
-Exchange rate variations will remain within acceptable range
-Exit from expansionary fiscal policy feasible and necessary
-High buoyancy in direct and indirect tax collections
-Spectrum auction and fuel prices decontrol to provide cushion
-Fiscal deficit may be lower than budgeted 8.4 percent of GDP
-Introduction of goods and services tax should be a priority
-Need to rationalize the food and fertilizer subsidies
-To sustain a growth rate improving farm productivity necessary
-Also important to close large infrastructure deficit, especially in power