GDP growth to be 7.4% in 2015-16: Ficci Outlook Survey

Not going in line with the Central Statistics Office' (CSO) ambitious estimates for the economic growth, industry body the Federation of Indian Chambers of Commerce and Industry (FICCI), has said that the Indian economy is expected to grow at 7.4 percent in the current fiscal, slightly lower than 7.6 percent projected in advance estimates of CSO.

The latest Economic Outlook Survey of the Ficci which was conducted during January/February 2016 among economists belonging to the industry, banking and financial services sector, has put across a median GDP growth forecast of 7.4 percent for the current fiscal year, which marks no change from the estimated growth in the previous survey round.

According to the survey results, agriculture sector is expected to record a growth of 1.7% in 2015-16, 0.3 percentage points lower than estimated growth in the previous round. Rabi sowing has been low in many areas owing to relatively warm winter this season. Industrial growth is projected to improve to 7.1% in 2015-16, while services sector growth is estimated at 9.7%.

The outlook of the participating economists on inflation remained moderate. The median forecast for Wholesale Price Index based inflation rate for 2015-16 has been put at (-)1.8 percent, with a minimum and maximum range of (-)2.8 percent and (-) 0.4 percent, respectively. The Consumer Price Index based inflation has a median forecast of 5.0% for 2015-16, with a minimum and maximum range of 4.6% and 6.3% respectively.

In the survey, most of the participants agreed that the impact of a slowdown in China, which is the second largest economy, on global growth is inevitable.This is expected to cause some volatility in the system, especially on other emerging markets. However, the economists opined that a repeat of the 2008 crisis was unlikely but one can expect continuing divergence in growth rates of developed and emerging economies.