Strong economic performance for India in '05: UN report

South Asia as whole registered a GDP growth rate of about 6.5 per cent in 2005 after recording 6.7 per cent in 2004.

india Updated: Jan 26, 2006 14:16 IST

India maintained a strong economic performance in 2005, driven largely by its manufacturing sector which was spurred by booming domestic demand for consumer goods as well as infrastructure development, a new United Nations report says.

On South Asia, the report says that while security concerns persist in the region, Indo-Pak relations appear to be thawing slowly and in case political momentum is maintained in the current year, both nations stand to gain economically through mutually beneficial trade, particularly in energy and water resources.

The South Asia as whole, the reports says, registered a GDP growth rate of about 6.5 per cent last year after recording 6.7 per cent in 2004.

However, this year a major downward risk is a further increase in international oil prices, raising fiscal and inflationary pressures as well as current-account deficit.

Moreover, if monsoon rains are insufficient, it could hurt agriculture growth and rural incomes and consumption, it said.

The report says Pakistan is expected to slow down slightly after two years high growth and Iran is likely to be hit by falling oil production owing to deterioration in production facilities.

The rest of the South Asia the report expects to post constant or accelerated GDP growth this year.

First Published: Jan 26, 2006 14:16 IST