Indian economy is likely to have grown by 8.6% in the January-March quarter and may grow near the upper end of an estimated range of
8.25% to 8.75% in this fiscal, Chief Economic Advisor at finance ministry Kaushik Basu said on Friday.
Mr Basu added that the economy’s growth is poised to touch 10% in the next four years. Though Asia’s third-largest economy is coming out of a 18-month long slowdown, Mr Basu said the policymakers have to be cautious in coming months too.
“I feel the remarkable turnaround that has taken place in the economy is really by and large through very careful fiscal measures, but there is a battle ahead,” he cautioned and advised the policy makers to be careful while crafting the policies.
The central bank will be reviewing the monetary policy next week and a 25-50 bps hike in key policy rates is expected to tame inflation. He said: “I believe inflation is still high... still of concern. We do need policies for that (containing it), but probably inflation has peaked.” Inflation, which touched 9.9% in March, may fall steeply after a few months, he added.
For the first three quarters of 2009-10, the economy grew at 6.1%, 7.9% and 6.0%, respectively. According to the Central Statistical Organisation, India is likely to have grown at 7.2% during the last fiscal.
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