CMIE sees GDP at 7% in FY10, on resurging H2 performance

India's real GDP is projected to grow by 7 per cent in FY10, which can be partly seen in the signs of recovery in the data available for January 2009, the Centre for Monitoring Indian Economy (CMIE) said in its monthly review here.

Economic think-tank CMIE expects the growth rate to climb slowly from around 6 per cent in the first-half to about 8 per cent in the second-half of FY10.

The global liquidity crisis in late September 2008 has suddenly brought the economy's story of nine per cent growth to a grinding halt. FY10 would gradually recover from this jolt.

Signs of recovery are already evident in the little data that is available for January 2009. While the global economy seems to be getting into a deep crisis, the domestic Indian economy is likely to see a smarter and quicker recovery in FY10, it said.

The agricultural sector has traditionally been the principal source of volatility in the overall growth of the Indian economy. A decline in GDP growth is usually the result of a fall in agricultural production.

In the last 10-year period ending 2005, the agricultural sector recorded a fall in output in every alternate year.