Deutsche Bank sees 6% GDP growth this fiscal | business | Hindustan Times
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Deutsche Bank sees 6% GDP growth this fiscal

business Updated: Jul 07, 2013 14:06 IST
Deutsche Bank

Foreign brokerage Deutsche Bank has pegged India's GDP growth rate at 6% this fiscal following the recent policy measures, even though vulnerabilities continue on the external front.

The economy expanded by a near decade-low of 5% last fiscal, due to a slew of problems, including a slowdown in investments.

"While really big bang measures like passing the GST Bill seems unlikely before the 2014 elections, there is enough in the policy pipeline to keep investors interested," the report said.

We are expecting growth to move up to 6%, the report said.

It also welcomed recent reform measures like gas price increase, opening up the multi-brand retail sector for higher foreign investments, saying "generally, the response from the authorities has been in the right direction".

"Contrary to the notion of policy paralysis, the past nine months have seen a flurry of reform measures to turn the economy around and backstop the financial system," it added.

However, the report expressed reservations over recent measures to the current account deficit like the curb on gold imports and selling, saying they are only "cosmetic".

Expecting the CAD, which touched a record high of 4.8% in FY13, to narrow down to 3.8%, it said factors like the softening commodity prices will help the CAD and not the curbs on gold imports.

The report sees the rupee clawing back to 55 per dollar by the end of the fiscal.

"We see the fiscal line being held by the authorities this year, and expect a slew of measures to stabilise the rupee and revive investor sentiment in the months ahead," it said.