It's 8.1 percent projected growth for 2005-06, says Economic Survey
27 Feb '06
5 min read
In a robust demonstration of its nascent strengths, the Indian economy, after growing at 8.5 per cent and 7.5 per cent in the two previous years, is projected to grow at 8.1 per cent in the current year 2005-06. Growth of Gross Domestic Product (GDP) at constant prices in excess of 8.0 per cent has been achieved by the economy in only five years of recorded history, and two out of these five are in the last three years. After dipping below 1.0 per cent in 2004-05, mostly on account of erratic rainfall, agricultural and allied sector's growth in 2005-06 is projected at 2.3 per cent. With a good kharif and bright rabi prospects, foodgrain production is expected to increase by 5 million tonnes (MT) in 2005-06. Some significant dimensions of the dynamic growth in recent years are: a new industrial resurgence; a pick up in investment; modest inflation in spite of spiraling global crude prices; rapid growth in exports and imports with a widening of the current account deficit; laying of some institutional foundations for faster development of physical infrastructure; progress in fiscal consolidation; and the launching of the National Rural Employment Guarantee (NREG) Scheme for inclusive growth and social security.
1.2 According to the national income data released by the Central Statistical Organisation (CSO) on February 7, 2006, the advance estimate (AE) for growth of GDP at factor cost at constant (1999-2000) prices in 2005-06 at 8.1 per cent was up 0.6 percentage points over the 7.5 per cent growth recorded in 2004-05 (Table 1.1). The CSO has changed the base year for calculation of national income aggregates at constant prices from 1993-94 to 1999-2000 (Box 1.1). The revised growth rate with base 1999-2000 is the same as or less than the rate with base 1993-94 for each of the four earlier years ending in 2003-04. For 2004-05, with the availability of detailed data at the sectoral level rather than some indicators that were available at the time when the advance estimate was made, growth of GDP at factor cost at 1999-2000 prices is 7.5 per cent (according to the quick estimate), up from the 6.9 per cent for GDP at factor cost estimated on February 7, and June 30, 2005.
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