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India's GDP to grow 7.9 pc this fiscal: Crisil
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SME Times News Bureau | 03 Oct, 2016
With agriculture income growth "at an above-trend 4 per cent", India's
real gross domestic product (GDP) is expected to grow this fiscal at 7.9
per cent, while annual retail inflation would remain contained at 5 per
cent, Indian rating agency Crisil said on Sunday.
"Net-net,
Crisil expects real GDP to grow 7.9 per cent this fiscal and agriculture
GDP at an above-trend 4 per cent, while CPI inflation would remain
contained at 5 per cent (10 basis points) up year-on-year," Crisil said
in a research note here ahead of the Reserve Bank of India's RBI) maiden
monteray review on Tuesday under a newly constituted Monetary Policy
Committee
"As for the road ahead, copious reservoirs augur well for the rabi season that starts this month," it added.
Noting
that the distribution of monsoon this season has been the best in the
last three years, with only a third of the districts seeing deficiency
compared with almost half in fiscal 2015 and 46 per cent in 2014, Crisil
said it expects nominal agricultural GDP to rise by Rs 1.49 trillion
this fiscal, compared with Rs 978 billion in fiscal 2016.
"So
this time around, India'sconsumption story will have two legs instead of
just the urban engine on which it has duked out the past two years,"
the report said.
"We see private consumption rising 90 basis
points to 8.3 per cent this fiscal compared with 7.4 per cent in fiscal
2016," it said.
"Crisil's state-wise Deficient Rainfall Impact
Parameter, or DRIP, scores show all states barring Gujarat, Tamil Nadu
and Odisha are above-trend," it added.
With ample rainfall this monsoon, the reservoir storage situation has improved.
"Data
till September 22 indicates reservoir storage was 17 per cent higher
on-year. This should support agricultural production this season and the
next," Crisil said.
The agency expects good agricultural output help ease pressure on food prices.
"On
the inflation front, we expect ample kharif production to boost supply
and bring down food inflation, especially for pulses where inflation has
remained in double digits for 14 months on the trot now," it said
On
the other hand, recent data shows global food prices are skyrocketing.
Where inflation settles will depend on the interplay of good monsoons,
tending to lower domestic food inflation, and rising global prices
exerting an upward pressure," the report said.
"Sugar and
confectionary prices have risen 17.7 per cent on-year since the
beginning of fiscal 2017 and this continues to be a stress point for
food inflation in the months ahead," it added.
India's annual
rate of inflation based on wholesale prices touched a two-year high in
August at 3.74 per cent from 3.55 per cent in the month before, official
data showed in September.
After rising for the first time in
April following 17 straight months of contraction, the WPI has
cumulatively risen by 4.45 per cent in the current fiscal up to August,
as against 0.23 per cent for the corresponding period in 2015.
Food articles inflation in August increased by 8.23 per cent on year-on-year basis.
Earlier
data on the consumer price index had showed that the annual retail
inflation had eased by 100 basis points to 5.05 per cent in August.
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Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
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66.20
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64.50 |
UK Pound
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87.50
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84.65 |
Euro
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78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
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