Economy upbeat, grows by 7.4 pc in 2009-10

New Delhi, May 31 (PTI) India's economy grew by a better
than estimated 7.4 per cent in 2009-10 on the back of double
digit expansion in manufacturing sector and not so dismal
showing by farm sector.
In fact, the economy grew by a robust 8.6 per cent in the
fourth quarter, fuelled by 16.3 per cent expansion in
manufacturing sector.
China, the only large country with higher growth rate
than India, witnessed 11.9 per cent growth in the same
quarter, while the fragile recovery in most countries,
particularly Europe, is under threat from a sovereign debt
crisis.
Earlier, the Central Statistical Organisation had
estimated the Indian economy to grow by 7.2 per cent for
2009-10.
The economic growth had slowed down to 6.7 per cent in
2008-09 after nine per cent expansion in the previous three
fiscal years, as the economy came under the impact of global
financial meltdown in 2008.
The 7.4 per cent growth clearly showed that stimulus
provided by the government through excise duty and service tax
cuts have yielded results, as the manufacturing which bore the
brunt of the slowdown, posted 10.8 per cent growth in 2009-10
against 3.2 per cent a year ago.
Bolstered by the growth numbers, Finance Minister Pranab
Mukherjee pegged the economic growth for this fiscal at over
8.5 per cent.
"... on the whole it is 7.2 per cent plus (in 2009-10).
I have already stated 8.5 per cent, about 8.5 per cent plus
(for the current fiscal)," he told reporters.
Stock markets reacted positively after GDP data came, but
profit taking pulled down the equity benchmark index Sensex
by around 10 points.
In fact, partial roll back of stimulus in this fiscal's
budget significantly slowed down the growth of community,
social and personal services to 5.6 per cent against earlier
estimates of 8.2 per cent.
"...since the stimulus has been partially rolled back it
also indicates the decline in community and personal and
social services etc," Finance Secretary Ashok Chawla said.
Agriculture, which was hit by weak monsoon last year,
did not fare as badly as was forecast earlier.
Farm and allied sectors grew by 0.2 per cent in 2009-10,
whereas they were shown to decline by 0.2 per cent by advance
estimates of the CSO earlier.
The sector posted negative growth of 1.8 per cent in the
third quarter of 2009-10 against decline of 1.4 per cent a
year ago. In the fourth quarter also, farm sector posted just
0.7 per cent growth against 3.3 per cent a year ago. PTI TEAM
KAB