PM panel pegs growth at over 8% in 2010-11

Pitches for raising duties as part of sops rollback.

The Prime Minister’s Economic Advisory Council, or PMEAC, today pegged growth in the next financial year (2010-11) at 8.2 per cent as the agriculture sector is expected to turn around next year. It also predicted that the country would return to 9 per cent growth in 2011-12.

Along with these, the panel pitched for raising duties in the coming Union Budget, as part of the rollback of stimulus measures.

For the current financial year (2009-10), it stuck to the Central Statistical Organisation’s advanced growth estimate of 7.2 per cent though added an upward bias to it. “The council expects a bounce-back in agricultural gross domestic product in the next year and maintenance of the desired trend growth of 4 per cent in 2011-12,” PMEAC Chairman C Rangarajan said after releasing a review of the economy.

The PM’s panel also expected the industrial and services sectors to continue to expand strongly through the next two years. “On this basis, we are making an initial estimate that the economy would grow by 8.2 percent in 2010-11 and by 9 per cent in 2011-12,” said Rangarajan.

Fiscal correction
On the issue of exit from the government’s stimulus measures, panel member M Govind Rao said that taking the excise duty to 10-12 per cent level was something that could be done though taking it back to the original level would be difficult.