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Indian industry expects over six percent GDP growth
Sunday, 02 November 2003, 20:30 IST
NEW DELHI: In the wake of a good monsoon and prospects of higher agriculture growth, Indian industry is optimistic that the country will register over six percent economic growth during 2003-04 fiscal.
Last year India saw only a 4.2 percent economic growth with a negative growth in agriculture, hit by a severe drought, which turned out to be the worst in three decades.
Based on a survey of 215 member companies both in public and private sectors, the Confederation of Indian Industry in its 60th Business Outlook Survey report released Sunday has given an optimistic forecast.
"In the current fiscal year the majority of the respondents (67 percent) have stated that the GDP growth would be greater than six percent," it states.
"Of the rest, 21 percent felt that economic growth would be between 5.5-6.0 percent, while eight percent of respondents stated that the economy would grow between 5.0-5.5 percent and only three percent felt that growth would be less than 5.0 percent," the CII states.
As for forecast of GDP growth in the next fiscal 2004-05, the majority of the respondents (61.2 percent) expected the growth to remain above the six percent mark.
"Thus we foresee two consecutive years of high growth, similar to that experienced in the mid-90s," the CII states.
The survey revealed that industry perceives their present conditions to be better than what they were six months back.
"Most respondents are of the opinion that the improvement in the overall economy has been higher relative to their activity sector and the own company.
"An increase by 3.3 points over the previous index reflects that the good monsoons, strong macro-indicators, favourable corporate results and the resulting boom in the stock markets have together led to an increase in positive sentiments across the industry," the CII stated.
On investment front, majority of the respondents (69.3 percent) disclosed plans of infusing fresh capital investments in the existing business unit.
With an expectation of a growth in demand, 97.1 percent of the respondents envisaged a growth in production for their company in the fiscal year 2003-04.
Of these 16.1 percent of the respondents expected an increase in production by around five percent of the existing production levels, while 19.7 percent expected an increase in production by five to 10 percent, 38.7 percent a rise of 10-20 percent and 22.6 percent an increase of over 20 percent.
Only 2.9 percent expected production levels to decline in 2003-04.
In the second half of the 2003-04 fiscal, 45.3 percent of the respondents expressed optimism of an increase in profit margins, though 18.2 percent thought there could be a drop.
"This reflects an overall improvement in the profitability of the Indian industry as in the last six months a lower 38 percent experienced an increase in profit margins and a higher 32.8 percent witnessed a decline," the report said.
Source: IANS
Source: IANS