Rangarajan expects economic growth to moderate to 6%



Rangarajan expects economic growth to moderate to 6% New Delhi: Newly-appointed chairman of the Prime Minister's Economic Advisory Council C Rangarajan expects the economic growth to moderate to 6 per cent on account of a delayed monsoon, as compared to 6.7 per cent in the previous fiscal.

New Delhi: Newly-appointed chairman of the Prime Minister's Economic Advisory Council C Rangarajan expects the economic growth to moderate to 6 per cent on account of a delayed monsoon, as compared to 6.7 per cent in the previous fiscal.

Pointing out that the poor monsoon will affect farm output, Rangarajan said, "Agriculture production will be hit, especially the kharif (summer crop)".

However, he added, the impact of poor agriculture production on the Gross Domestic Product (GDP) during the current fiscal may not be much.

"Overall growth rate will not be impacted much, as agriculture has just 18-20 per cent contribution in the country's GDP," said Rangarajan, who headed the PMEAC from 2005 to 2008.

Having registered an average economic growth of nine per cent during the three consecutive years, the GDP growth rate slipped to 6.7 per cent in 2008-09, mainly on account of the impact of the global financial crisis on the country.

The Reserve Bank, in its first quarterly review of the annual monetary policy last month, had projected 6 per cent GDP growth for the current fiscal with an upward bias.

Bureau Report