New Delhi, July 02: India could see growth this year of roughly 7 percent and then resume the faster expansion of recent years, provided it makes sweeping reforms including removal of fuel subsidies and accelerates infrastructure development, the Economic survey 2008-09, that presented in Parliament today, said.
The economic survey prepared by the finance ministry, released ahead of Monday's budget announcement for the fiscal year ending in March 2010, said inflation is no longer a worry and called for an urgent return to the targeted fiscal deficit of 3 percent.
Following is the reaction of some industry leaders:
Shubhada Rao, chief economist, Yes Bank, Mumbai:
"The government has indicated its medium-term agenda towards market reforms, fiscal consolidation among others. We believe the government will initiate some of these in small doses in the forthcoming budget."
Rupa Rege Nitsure, chief economist, Bank Of Baroda:
"The economic survey appears quite progressive and provides a thrust on giving market orientation and structural reforms that would go a long way."
"It is heartening to see that the survey has seriously raised concerns on fiscal consolidation and gives confidence that the budget will see a good trigger for disinvestment and rationalization of fuel and fertilizers."
Amitabh Chakraborty, president equities at Religare securities in Mumbai
"The survey is giving a clear direction on where the government is likely to move over the next 3 to 5 years. I'm quite excited. It is wrong to assume everything will be announced in the budget (on July 6). It is the strategic intent, a clear roadmap. The market should take it positively."
Sujan Hajra, chief economist, Anand Rathi Securities, Mumbai
"My sense is that the economic survey is a very pragmatic and pro-reform policy statement but I would see it as a more medium-term expression of intention of the government rather than recommendations which could be implemented in the very short term.
"As in the past, the stancing of the economic survey and that of the Union Budget have often been divergent and I expect similar divergence this time around as well."
Eco Survey raises hopes for reformist Budget: India Inc
New Delhi: The Economic Survey tabled in
Parliament today raised hopes of India Inc for a reformist
Budget.
"Given the wide ranging reform measures mooted in the
Economic Survey, FICCI expects a strong reformist Union
Budget," the chamber President Harsh Pati Singhania said in a
statement.
On concerns raised in the survey on a possible shortfall
in private consumption demand, it said, there is need to push
through fiscal and other measures including easing consumer
credit.
Echoing similar views, PHDCCI President Satish Bagrodia
said the sharp dip in private consumption growth is a major
cause for concern at this stage.
Industry body Assocham said that the survey has rightly
stresses the need for divestment of government equity in
Navratna companies to contain fiscal deficit.
The Economic Survey while recommending a disinvestment
target of Rs 25,000 crore annually, said that the government
should sell a minimum 10 per cent stake in all unlisted public
sector enterprises and auction those that can't be revived.
Bureau Report