DEAR FRIENDS: BEFORE I COULD FINISH MY MORNING POST TO YOU (16 03 2012 THERE IS ANOTHER ADDITION TO INDIA INK. -BHUBAN Service Economy Keeps India Afloat By HARI KUMAR Kainaz Amaria for The New York Times Software engineers work at a Tata Consulting Services office in Mumbai, Maharashtra, Aug. 11, 2011. India’s poor industrial growth is dragging down the overall economy, according to the Economic Survey released on Thursday, while the service sector appears to be keeping the economy afloat at its current growth rate of just under 7 percent. “Managing growth and price stability are the major challenges of macroeconomic policy making,” Finance Minister Pranab Mukherjee said when releasing the survey in Parliament. The Indian economy is expected to grow by 7.6 percent in the 2012-13 fiscal year, and 8.6 percent in 2013-14, assuming normal rains, stable oil prices and reasonable growth in world economy. The survey noted that India is still one of the fastest growing economies in the world and its sovereign credit rating rose by 2.98 percent during 2007-12. India’s service and agriculture sector performed well during the 2011-12 financial year, which ends March 32. The services sector “continues to be a star performer,” and its share in overall gross domestic product has risen to 59 percent, up from 58 percent in the previous fiscal year. The sector grew at 9.4 percent. Industry, which is broadly defined as manufacturing and production of raw materials and goods, made up 27 percent of India’s gross domestic product, and grew 3.6 percent from April to December of last year, a sharp decline from 8.3 percent in the corresponding period in 2010. Saurabh Das/Associated Press Finance Minister Pranab Mukherjee holds up a copy of the economic survey report for 2011-2012 as he comes out of Parliament, New Delhi, March 15, 2012. Several domestic factors, including a sharp increase in interest rates, high inflation rate, decline in foreign investment, delayed decision making, difficulty of land acquisition and the difficultly in getting environmental clearances for factories and projects, led to the decline in industrial growth. The global recession also played a substantial role in the decline of industrial activity. The agriculture sector is estimated to grow 2.5 percent in 2011-12, with food grain production likely to cross 250 million tons. India still imports a large amount of edible oil and pulses to feed its 1.2 billion people. India’s planning commission estimates there will be $1 trillion of investment in the infrastructure sector, which includes roads, power, ports and airports, in the coming five years. Half of this amount will come from the private sector, the survey estimates. “There is need for introducing more innovative schemes to attract large scale investment into infrastructure” the survey said. Chronic delays afflict infrastructure projects in India. A government report for the month of October 2011 that tracked the progress of 583 infrastructure projects in different sectors found that only seven projects were completed ahead of schedule, 166 were on time, 235 were delayed and a remaining 175 were undertaken without any deadlines whatsoever. _______________________________________________ assam mailing list assam@assamnet.org http://assamnet.org/mailman/listinfo/assam_assamnet.org
