Growth projected at 7.4% for 2018-19, 7.5% for 2019-20: FICCI's Economic Outlook Survey

The latest round of FICCI's Economic Outlook Survey puts forth an annual median GDP growth forecast for 2018-19 at 7.4 per cent and for 2019-20 at 7.5 per cent. The survey was conducted during October/November 2018 among economists belonging to the industry, banking and financial services sectors. The median growth forecast for agriculture and allied activities has been put at 3.9 per cent for 2018-19. Industry and services sector are expected to grow by 6.8 per cent and 8.2 per cent respectively during 2018-19.

Further, the quarterly median forecasts indicate a GDP growth of 7.4 per cent in the second quarter of 2018-19. The median growth forecast for IIP was put at 4.6 per cent for 2018-19 by the participating economists, with a minimum and maximum range of 4.5 per cent and 5.4 per cent respectively. The outlook of the participating economists on inflation remained moderate. CPI based inflation has a median forecast of 4.3 per cent for 2018-19, with a minimum and maximum range of 4.0 per cent and 4.8 per cent respectively. Concerns seem evident on external front with median current account deficit forecast pegged at 2.7 per cent of GDP for 2018-19.

Participating economists believed that current situation is majorly a result of global spill overs and is not so much due to domestic factors. Global developments such as elevated global crude/commodity prices and significant sell-offs in emerging market have mainly been responsible for this scenario. The economists felt that measures announced by the government will only work in the short run and more measures need to be taken to address long-term concerns on external front. Participating economists unanimously called for a need to boost exports to safeguard the economy from challenges arising on external front. They believed that consistent encouragement and strengthening of the export sector seemed to be a more sustainable strategy to overcome external challenges.

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