The RBI has retained the GDP growth at 7.6 per cent for 2016-17 in its bi-monthly Monetary Police Statement announced on Tuesday, due to the risks like fading lower input costs that will make impact m
The RBI has retained the GDP growth at 7.6 per cent for 2016-17 in its bi-monthly Monetary Police Statement announced on Tuesday, due to the risks like fading lower input costs that will make impact manufacturing, persistent corporate sector stress, and risk aversion in the banking system. This combined with the global weak growth and trade outlook, the RBI said “could impart a downside to growth outcomes going forward.”
These could neutralise the headwinds of an expected favourable monsoon, boost to consumption demand from implementation of the 7th Pay Commission recommendations and the one rank one pay (OROP). RBI continuing accommodative monetary policy would also help growth. The good monsoon could work as a “favourable supply shock,” by strengthen rural demands and augmenting supply the RBI said.
Crisil Ratings has projected growth at a much higher level of 7.9 per cent assuming a normal monsoon. NITI Aayog member Bibek Debroy too assumes India’s growth at around 7.8 per cent. “I think th country's growth will be slightly higher than the finance ministry's projection of 7.5 per cent to 7.8 per cent,” he said at an interactive session with the BCC.
