Chief economic adviser Kaushik Basu today pegged the economic growth at over 8.6 per cent for the January-March quarter of 2009-10, which will ensure that the Indian economy expands by a tad higher than 7.2 per cent as estimated by the government.
"My own calculation is India's growth rate is going to be above 8.6 per cent in the last quarter of 2009-10," Basu said at a forum organised by media house Jagran group.
The Central Statistical Organisation (CSO) has projected a growth rate of 7.2 per cent for the last fiscal, which
requires the economy to have grown by 8.58 per cent in the January-March quarter.
The economy grew by 6.1 per cent in the first quarter of 2009-10, 7.9 per cent in the second quarter and 6 per
cent in the third quarter.
Basu said if the numbers of the first three quarters on agriculture, industry and services are extrapolated, then the
fourth quarter would have grown by 8.4 per cent.
However, he said the services sector did extremely well and extrapolation, in this case, pulls down the growth rate.
"My own feeling is that services sector which in India did historically well did not do too well in the first, second
and the third quarters ... my expectation is that services would have picked up in the fourth quarter ... 8.6 plus growth
is entirely possible," he said.
Basu said the rise in industrial and manufacturing growth is a good sign as it is pulling up the economy's growth.
"India's industrial sector, the manufacturing sector, has actually been doing extremely well over the last 6 months or
so. In fact, the growth is being sort of pulled, which has not been the case earlier, by the remarkably good performance of the industrial and the manufacturing sector," he said.
Indian economic growth slowed down to 6.7 per cent during 2008-09 from 9 per cent in the previous three fiscal years
after the global financial meltdown had ripple effects.
After stimulus was provided by tax cuts and step up in public expenditure, economic growth improved. The economy is
expected to grow by 8.5 per cent this fiscal despite partial withdrawal of stimulus and 9 per cent next fiscal.