7.6% growth amid global turmoil is noteworthy: FinMin

Terming the 7.6 per cent growth projection for current fiscal as “noteworthy and very significant” amidst global turmoil, Finance Ministry today said the government is keeping a close watch on developments and is prepared to deal with challenges.

“Given this kind of volatility and turmoil prevailing all over the world in the global economy, the growth forecast for the current year at 7.6 per cent is definitely noteworthy and very significant,” Economic Affairs Secretary Shkatikanta Das told reporters.

He further said 7.6 per cent growth projected for 2015-16 by the CSO is reflective of the fact that “India is able to hold on to growth, which one can call robust under the current circumstances”.

World over, nations are facing turmoil in stocks and currency markets and India is no exception, Das said, adding “every day there is a new challenge or there is a new development in some part of the world or the other”.

Observing that uncertainty and volatility have become a new norm, Das said “the government is keeping a very close watch on international and global development and government is prepared to deal with all these challenges”.

The IMF in its recent report on world economy has cut global growth estimates to 3.4 per cent, from the earlier projection of 3.6 per cent. For India, however, it has retained its forecast at 7.3 per cent.

As regards India, Das said there are challenges in the agriculture sector, which has faced two consecutive years of drought and to deal with that the government has been taking necessary measures with regard to food crop production.

“In the last four years, there has been deficient rainfall and therefore agriculture production has gone down.  The moisture content in the soil also got adversely impacted.

This is an area of concern. The Government has been dealing with the situation. Government will see how monsoon works out next year,” he added. 

“The CSO’s advance estimate for industry growth in the current year is 7.3 per cent and for manufacturing is about 9.5 per cent. Services over the year have remained quite steady as projected at 9.2 per cent,” he said.

The manufacturing sector grew at 6 per cent in 2012-13, 5.6 per cent in 2013-14, and 5.5 in 2014-15.

Although manufacturing sector is showing clear sign of improvement, agriculture sector continues to be an area of concern, Das said.

CSO has projected agriculture sector to grow at 1.1 per cent in current fiscal, as against a contraction of 0.2 per cent in year-ago period.

He said in agriculture sector there are two segments— crop and non-crop.

“There is a decline and negative growth in the crop segment, but with regard to non-crop segment there is a growth of about 5 per cent. So part of the agricultural livelihood, which comes from non-crop sector, there is a growth which augurs well for the sector as a whole but nonetheless agriculture remains an area of concern,” Das added.