India's GDP growth to cross 8% this financial year: Arvind Panagariya

He was of the view that economy will grow at a higher rate as revenues are increasing and inflation has entered the positive zone

India's economic growth will cross the 8% mark this financial year on the back of good monsoon and pick up in manufacturing, NITI Aayog Vice-Chairman Arvind Panagariya has said.

"India will cross 8% economic growth during the current financial year. Good Monsoon will push farm sector growth to 4-5% this year," Panagariya said.

He said the growth in the last quarter of the previous financial year touched 7.9% because of uptick in manufacturing activity and improved performance of agriculture sector.

According to the data released by the Central Statistics Office (CSO), manufacturing sector during the fourth quarter recorded a growth rate of 9.3% while farm sector grew at 2.3%.

India economy clocked a five-year high growth rate of 7.6% in 2015-16, mainly on account of good performance of manufacturing and improvement in farm sectors.

Panagariya was of the view that economy will grow at a higher rate as revenues are increasing and inflation has entered the positive zone.

Higher wholesale inflation rate indicates the rise in margins for the industry. Rising for a second straight month, wholesale price-based inflation jumped to 0.79% in May with vegetable prices witnessing a double-digit growth.

The April WPI-based inflation was at 0.34% and in March it was (-)0.45% while it stood at (-)2.20% in May last year.

After remaining in negative zone for 17 months, the WPI inflation turned positive in April this year.

Retail inflation too touched a 21-month high of 5.76% in May mainly on rising prices of food items.

Reserve Bank has pegged growth at 7.6% for the current financial year, while the Economic Survey has projected the economic growth at 7-7.75% for this financial year.