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Tenth Plan Sees Big Jump In Savings, Investment

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Our Economy Bureau BUSINESS STANDARD

The Tenth-Five Year Plan aims to pull up the gross domestic product (GDP) growth rate to 7.93 per cent per annum, up from 5.35 per cent during the Ninth Plan.

Savings as a percentage of GDP are expected to go up while the share of consumption in GDP is expected to fall by 3.5 percentage points.

Investment, as a percentage of GDP is projected to rise, accompanied by a fall in the incremental capital-output ratio.

Gross domestic saving is projected to go up from 23.31 per cent of GDP in the Ninth Plan to 26.84 per cent during the Tenth Plan.

 

The annual growth in savings is expected to touch 13 per cent, up from the Ninth Plan levels of 7.4 per cent.

Private savings are projected to go up from 24.13 per cent to 26.4 per cent of GDP, however the growth is expected to decelerate as compared to the Ninth Plan.

The rate of growth of government savings is expected to spurt sharply from a fall of almost 29 per cent during the Ninth Plan to a rise of 36 per cent in the Tenth Plan.

On the investment side, the Plan projects a huge increase in the investment rate, up from 24.23 per cent of GDP to 28.41 per cent. The annual growth in investment is projected to double from 7 per cent to 14.3 per cent.

A large portion of this investment is expected to come from the private sector, whose gross investment as a percentage of GDP at market prices is expected to go up from 8.87 per cent in the Ninth Plan to 10.37 per cent during the Tenth Plan.

The rate of gross investment by households is expected to go up to 9.6 per cent of GDP as against 8.21 per cent during the previous Plan.

A sharp jump in investment by the government is also expected, with its share going up from 3.52 per cent to 4.64 per cent of GDP.

Total consumption as a percentage for GDP is, however, projected to fall from 78.53 per cent of GDP to 75.06 per cent.

Of this, the fall in private consumption will be from 65.32 per cent to 62 per cent of GDP while public consumption is projected to fall from 13.2 per cent to 13.06 per cent of GDP.

While consumption growth is expected to increase from 4.6 per cent to 6.5 per cent per year, the growth rate of public consumption is expected to fall sharply from 10.7 per cent to 4.65 per cent per year.

Public borrowings, as a percentage of GDP, are expected to go up marginally from 7.97 per cent to 8 per cent.

The current account deficit is projected to go up from 0.91 per cent of GDP to 1.57 per cent. Exports of good and services are expected to grow at a rate of 12.4 per cent per annum, as compared to 8.43 per cent during the Ninth Plan.

On the other hand, imports are expected to grow by 14.4 per cent during the Tenth Plan up from 6.3 per cent in the Ninth Plan.


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First Published: Oct 07 2002 | 12:00 AM IST

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