Final FY12 GDP readings to be around 6%: Report
Mumbai: The revised FY'2011-12 gross domestic product (GDP) growth is likely to fall to 6 percent on account of a slump in manufacturing led by weak demand and difficulty in accessing funds, according to a report.
First revised estimate of GDP for FY'12 was 6.2 percent, based on a 2.7 percent growth in the industrial sector. The second revised estimate for FY1'2 is scheduled to be released on January 31.
"We expect overall industrial sector growth may have logged in a lower growth rate in the final analysis. This may finally drag the overall GDP growth to 6 percent, sub-6 percent may not be ruled out, from the earlier provisional figure of 6.2 percent, unless there is a significant upward revision in other components which looks unlikely," SBI said in its internal report Ecowrap.
The report said the uncertain global and domestic environment dragged investment down by 8.7 percent in FY'12.
Tight monetary policy resulted in escalating lending rates discouraging industrial activity and interest paid by firms rose 37.1 percent in FY'12, significantly higher than 20.1 percent rise in interest payment in FY11 and a mere 6.8 percent rise in FY'10.