Crisil sees 7.9 per cent growth in 2016-17

India will need relentless implementation of both policy and executive measures like Uday, revitalisation of the PPP regime and structural reforms for public sector banks etc. to see strong growth, said rating agency Crisil.

In its research paper on India Outlook 2017, Crisil predicted GDP growth to be at a high 7.9 per cent on a good monsoon and agriculture could grow four per cent contributing to the boost to the country’s economy.

One factor that could impede investment is the highly leverged corporate sector. “It is a high 22 per cent of total outstanding debt in companies where the debt equity ratio is 4:1 and in the case where it is 2:1 the debt is a high 58 per cent. This will affect the investment capacity of these firms,” the rating agency observed, adding that the government is mitigating the situation by increasing public investments through road projects and reviving stalled projects.

India Inc, excluding finance and oil companies, said Crisil, could see its revenue growth increase 8.9 per cent from 4 per cent and its net profit grow 12-15 per cent because of a better topline growth, subdued working capital needs and falling interest rates.

The strugglers could be capital goods manufacturers, thermal power and real estate.

Meanwhile CII sees the government’s decisions to reform the hydrocarbon sector to move towards a transparent market economy could unlock significant investments of close to $30-40 billion in the oil and gas exploration sector alone.