 "RBI pegs 5.7% growth for current fiscal")
"The Reserve Bank's baseline projection of GDP growth for 2013-14 is 5.7%...The bank's current assessment is that activity will remain subdued during the first half of this year with a modest pick-up in the second half, subject to appropriate conditions ensuing," RBI said in its annual monetary policy review for 2013-14.
India's economy grew by 5% in the last fiscal, lowest in a decade, on account of poor performance of manufacturing, agriculture and services sector.
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The RBI's current fiscal year's growth estimate of 5.7% is much lower than the finance ministry's growth projection of 6.1-6.7% and Prime Minister's Economic Advisory Council's growth projection of 6.4% for 2013-14.
It is also lower than the World Bank's growth projection, which predicted Indian economy to grow by 6.1% in 2013-14 on account of robust domestic demand, strong savings and investment rate.
Not happy with RBI's growth projection, Planning Commission Deputy Chairman Montek Singh Ahluwalia had described its outlook as "pessimistic".
"Reserve Bank is clearly more pessimistic than the government is. I think that the government forecast as of now is feasible. Critically what matters is, how effective we are in restoring the momentum of investment in the large projects", the Plan panel deputy chief said.
The Reserve Bank today cut the key interest rate by just 0.25% to 7.25% and kept the liquidity enhancing cash reserve requirement unchanged.
Further, the central bank said it expects inflation to hover broadly around the 5.5% mark in the current fiscal and will deploy "all instruments at command" to bring it down to 5% by March next year.
India's headline inflation in March fell to its lowest in more than three years at 5.96%, but the consumer price index remained elevated at 10.39%.