Good monsoon rains and higher estimates of crop acreage will help agricultural production grow by 7.2 per cent in 2010-11, after recording a 6.6 per cent decline in the drought-hit previous financial year, according to the Centre for Monitoring Indian Economy (CMIE).
The government’s estimates paint a more optimistic picture, with a 10. 4 per cent rise in the kharif output and an overall projection of 13 per cent increase in agricultural output during the financial year.
As of October 7, kharif sowing was completed across 102.2 million hectares, which was 6.4 million hectares more than the acreage reported during the corresponding period in 2009.
CMIE also pegged the gross domestic product (GDP) growth at 9.2 per cent in 2010-11 on the back of sustained robust growth in manufacturing and services sectors.
Moreover, it criticised the outdated Index of Industrial Production (IIP) data series, stating it was not giving the right picture of the momentum of growth in the industrial sector.
“It had recorded 11.2 per cent growth in the June quarter, but we believe that the growth was much higher than 11.2 per cent. This is because sales revenues of the manufacturing companies rose by 23.8 per cent, while the rate of inflation in manufactured products (including petroleum products) was 8.2 per cent, implying that sales volumes grew by about 14.4 per cent,” the CMIE report said.
The report further stated that inflation would moderate to 7.9 per cent by the end of 2010-11.
