MUMBAI (Reuters) - India's economy is expected to grow 7-7.5 percent in the fiscal year to March 2017, a key government report said on Friday, ahead of the presentation of the annual budget by Finance Minister Arun Jaitley on Monday.
COMMENTARY
ABHISHEK UPADHYAY, ECONOMIST, ICICI SECURITIES PRIMARY DEALERSHIP, MUMBAI
"Growth assumptions look fine, may be even a tad conservative under the assumption of "normal" monsoons, as does the projection for the CAD (current account deficit) to stay contained.
"The problem in the external accounts continues to be more on the capital account, rather than current account. That is where focus on macro-stability is important.
"The survey signals that government may adhere to 3.9 percent fiscal deficit target for FY16, but I do not share the belief that there is scope to review the medium term fiscal consolidation framework.
"State fiscal deficits are already poised to widen, and there is no fiscal space. A review of the roadmap should also limit scope for monetary accommodation.
"Inflation projections seem optimistic, given the stickiness seen in core inflation, and the impact of pay commission linked wage hikes on CPI, which may continue to seep into the index as states also implement the pay hikes."
(Reporting by Mumbai newsroom; Compiled by Rafael Nam)
