Slowdown bottoming out, FY14 growth likely at 6.4%: PMEAC

Stating that the economic slowdown has bottomed out, Prime Minister's Economic Advisory panel has pegged the growth rate for the current fiscal at 6.4 per cent, up from 5 per cent in 2012-13.
Releasing the Economic review, PM's Economic Advisory Council (PMEAC) Chairman C Rangarajan said the economy can achieve growth rate of 7.5-8 per cent over the short term on more policy and administrative actions besides speedy execution of projects.
"I believe we have reached the bottom, the economy will now continue to grow at a faster rate," Rangarajan said adding the performance of agriculture and manufacture is likely to improve.

The economic growth rate during 2012-13 declined to decade's low of 5 per cent, which the PMEAC hoped could be revised slightly upwards when the final figures are released. The PMEAC had projected a growth rate of 6.7 per cent for the previous fiscal in August last year.
Rangarajan emphasised that government needed to contain Current Account Deficit (CAD), make financial instruments more attractive and accord speedy clearances to projects to achieve higher growth.
"The very high level of investment rate that we have even now gives us the hope that if we take action for speedy implementation of projects, we can achieve the higher rate of growth quickly even in the short term," Rangarajan said.

Talking about downside risks to inflation, he said "There are more administrative prices which needs to be corrected".
Last fiscal, the government took a number of reform measures including partial deregulation of the sugar sector, partial deregulation of diesel prices and capping of subsidised LPG cylinder for domestic usage.
The PMEAC projected inflation for the fiscal at 6 per cent and CAD to come down to 4.7 per cent of GDP, from 5.1 per cent in 2012-13.