Industrial growth may decline to 1.5-2.5% in June: D&B
Press Trust of India / New Delhi Jul 14, 2009, 19:39 IST
Research firm Dun & Bradstreet (D&B) today said the country's industrial growth is likely to fall between 1.5 per cent and 2.5 per cent in June from 2.7 per cent in May, mainly due to muted external demand conditions.
"Concerns persist especially for the export-oriented industries owing to muted external demand conditions. D&B expects IIP to have grown by 1.5-2.5 per cent during Jun-09," D&B said in a statement.
Also, the expectation of 'delayed and below normal monsoon' does not augur well for the agriculture sector and could turn out to be a major impediment in the revival phase.
D&B added that it would take some more time for the economy to recover completely and set on a high growth path.
However, improvement in growth rate of industrial production for the second consecutive month is indicative of stability emerging within the economy.
Showing signs of economic recovery, industry grew 2.7 per cent in May though the growth is much lower than 4.4 per cent recorded in the same month last year.
"The stimulus related proposals in the Union Budget FY10 will aid in consolidating the base for the economic revival that is expected to take place in the second half of the current fiscal," D&B India COO Kaushal Sampat said.
He, however, said the huge borrowing required to fund the mounting fiscal deficit might crowd out private investment at a time when economic recovery sets in.
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