Economic Survey estimates 7-7.5 pc growth for 2016-17

The Economic Survey for 2015-16, presented in Parliament on Friday, projected a 7-7.5 per cent GDP growth rate in the next fiscal which could accelerate to eight per cent in a couple of years. The Survey also made a case for carrying forward the reform process to achieve macroeconomic stability.

Inspite of challenges and lower than projected GDP growth rate during 2015-16, the fiscal deficit target of 3.9 per cent of GDP seems achievable, it said. After a 7.2 per cent economic growth in 2014-15, it said the expansion in economy will be 7.6 per cent in the current fiscal, the fastest in the world.

However, it cautioned that if the world economy remained weak, India’s growth will face considerable headwinds.

On the domestic side, two factors can boost consumption, increased spending from higher wages and allowances of Government workers if the Seventh Pay Commission is implemented and return of normal monsoon.

At the same time, the Survey enumerated three downside risks — turmoil in global economy could worsen the outlook of exports, contrary to expectations oil price rise would increase the drag from consumption and the most serious risk is the combination of these two factors.