If you thought that the worst was over, think again. India’s growth rate is likely to fall further at 6 per cent in 2009 as the full impact of the recession is yet to be seen, according to a United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) report released on Thursday.
In 2008, the growth rate is estimated to touch 7.1 per cent.
“We have only seen a partial effect of the recession in 2008. The full effect would be felt in 2009 and in addition, the full impact on the export side is also to be seen,” Shuvojit Banerjee, economic affairs officer, ESCAP said.
The good news, however, is that global economic recovery would be driven by “new growth poles” such as India and China, with strong domestic demand and have shown higher degree of resilience in the wake of the global slowdown.
Nagesh Kumar, director general, RIS, felt the government should come up with a stimulus package of $50 billion — which is 4-5 per cent of the country’s GDP — to tide over the crisis.
“Though the growth estimate for 2009 is 6 per cent, it could well be above that with stimulus packages showing results and the general elections which would generate demand,” he said, adding the implementation of the Sixth Pay Commission would also raise demand.