The Indian economy is likely to grow in the range of 5.4 to 5.9 percent in 2014-15, says the annual Economic Survey.
"Indian economy is likely to grow in the range of 5.4 to 5.9 percent in 2014-15 overcoming the sub-5 percent growth of Gross Domestic Product (GDP) witnessed over the last two years. The growth slowdown in the last two years was broad based, affecting in particular the industry sector", said the Survey for 2013-14 tabled by Finance Minister Arun Jaitley in parliament Wednesday.
The GDP growth slowed down to the decade's low of 4.5 percent in 2012-13 and picked up marginally to 4.7 percent in 2013-14.
The Survey expects that a moderation in inflation will ease the monetary policy stance and revive the confidence of investors.
"Moderation in inflation would ease the monetary policy stance and revive the confidence of investors, and with the global economy expected to recover moderately, particularly on account of performance in some advanced economies, the economy can look forward to better growth prospects in 2014-15 and beyond," it added.
The Survey said the government's measures to improve the investment climate and improve governance could push up growth to 7-8 percent in the coming years.
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Regaining the growth momentum requires restoring domestic macroeconomic balance and enhancing efficiency, it said.
"To this end, the emphasis of policy would have to remain on fiscal consolidation and removal of structural constraints," the Economic Survey 2013-14 said.
Targeted measures by the government and Reserve Bank of India, it said, "have improved the external economic situation significantly, even as India remains exposed to risk on/off sentiments of investors and to policy shifts in advanced economies."
Both the current account and fiscal deficits witnessed an improved in the 2013-14 over the situation in the previous fiscals.
On the industrial front, the Survey said the contraction in mining and quarrying for the second year in a row and the negligible growth in manufacturing over the past two years, indicate the severity of structural bottlenecks.
"The revival of the industrial sector, with its economy-wide linkages, is central to the revival of aggregate economic activity," it said.