India GDP to grow above 8%

India is expected to post economic growth of more than eight percent when it reports data for the fiscal fourth-quarter on Tuesday, despite a series of rate hikes that have hit industrial output.

Asia's third-largest economy is estimated to have expanded 8.2 percent from a year earlier in the three months to March 2011, according to the median estimate in a Dow Jones Newswires poll of 19 economists.

India's Central Statistical Organisation will announce Gross Domestic Product (GDP) figures at 0530 GMT.
The forecast growth figure would be the same as in the October-December period but below the 8.6 percent growth recorded in the fourth quarter of the previous fiscal year.

India's economy is still clocking robust growth, second only to neighbouring China among major economies, as domestic demand continues to grow on the back of rising income.

The farm sector is expected to show a strong recovery, boosted by a good winter harvest, but manufacturing activity has been slowed by nine interest rate hikes in the past 15 months to tackle stubbornly high inflation.

The economy is believed to have grown 8.5 percent in fiscal year 2010/11 that ended in March 2011, just below the government's 8.6 percent estimate, and up from eight percent a year earlier, according to the Dow Jones poll.
The government had forecast nine percent growth for this year.

Economists and government officials have recently revised downward their expectations for the current financial year, citing rising crude oil and other commodity prices and doubts about economic recovery in developed nations.
 

Prime Minister Manmohan Singh said at the weekend he was confident that India would achieve 8.5 percent growth this year, helped by expectations of a normal monsoon which is crucial to economic expansion.

 

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