Economy likely to do better in 2012/13: Basu
New Delhi: India's economy will likely grow faster next fiscal year than in 2011/12 because of an improved external environment and a shift in policy focus from containing inflation to growth, Chief Economic Adviser Kaushik Basu said on Wednesday.
However, Basu said that public finances were expected to remain under pressure in 2012/13.
Although the official forecast for 2012/13 is still to be released, some private economists now expect the annual economic growth to be below 7 percent, lower than 7-7.5 percent widely expected to for the year to end-March 2012.
"I would forecast next year to be better than the present one," Basu said, predicting growth in the current year of close to 7.5 percent, a pick up the following year and a return to "full-steam" growth of around 9 percent by 2013/14.
In December, the government slashed its full-year growth forecast for the current fiscal year to about 7.5 percent from 9 percent amid slowing domestic and global demand.
Gross domestic product growth slowed to 6.9 percent in the quarter to end-September, its weakest pace in more than two years. Industrial output contracted in October for the first time in more than two years.
"The US is on a slow rise. Europe is still on the brink but if you ask me to bet, I would say, on balance it would escape falling into another recession," he said.
"If these expectations are right, then I think India has enough fundamental strength that we will get out of the current slowdown and begin to move."