India
- Authors:
- OECD
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Pages
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176–179
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DOI
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10.1787/eco_outlook-v2007-1-37-en
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Abstract
Recent rapid economic growth is expected to continue and be close to 9% in fiscal year 2006, despite a poor performance from the agricultural sector. Investment has been particularly buoyant during this expansion, contributing to a substantial increase in the economy’s potential growth rate. Monetary and fiscal policies have both become tighter, which will lead to slower growth in the non-agricultural sector. A return to a normal harvest, however, should limit the extent of the slowdown in the whole economy. Inflation, as measured by the GDP deflator, is expected to remain stable at 5%, in line with official objectives. The current account has moved back into a deficit of 1.3% of GDP in 2006 and seems likely to reach 2.0% of GDP in fiscal year 2008.