India to have U-shape economic recovery in next 2 qtrs

Last Updated: Friday, August 7, 2009 - 19:29

New Delhi: The government today forecast the
economy would see a `U` shaped recovery in the next six months
with the stimulus measures sustaining growth.

It said the second half of the current financial year
would be better than the first half.

"A `U` shaped revival of growth path is expected with
two not-so-good quarters followed by two good quarters," the
minister of state for finance, Namo Narain Meena, told Lok
Sabha.

In a written reply, he said, "the steps initiated by the
government for sustaining growth momentum include short-term
measures of fiscal stimulus packages by enhancing expenditure
levels and duty reductions."

He cited the Economic Survey 2008-09 as saying the real
gross domestic product (GDP) at factor cost is expected to
grow at around 7 plus/minus 0.75 per cent in the fiscal
2009-10, assuming a normal monsoon.

The minister said the government had decided to raise a
higher proportion of budgeted borrowings in the first half of
the fiscal to minimise the negative impact of the borrowings
on the financial market.

"As the demand for credit by the commercial sector is
expected to gather momentum in the second half of the current
financial year with expected revival of the economy, the
market borrowings of the government have been frontloaded to
ensure that the borrowing programme is undertaken in a
non-disruptive manner," he said.

Accordingly, for the first half (April-September 2009),
market borrowing programme for Rs 2,99,000 crore, constituting
about 66 per cent of the gross borrowings for the fiscal, have
been announced.

Bureau Report



First Published: Friday, August 7, 2009 - 19:29

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