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Lacklustre in agriculture
Economy set to grow at 9.2 pc
S. Satyanarayanan
Tribune News Service

New Delhi, February 7
Despite 3.3 per cent slump in agriculture growth, the country’s GDP growth is projected at 9.2 per cent during 2006-07, against 9 per cent in the previous year, thanks to robust performance in manufacturing and financial services.

According to advance estimates of National Income 2006-07 released here today by the Central Statistical Organisation (CSO), the growth in agriculture dipped to 2.7 per cent this fiscal after rising to 6 per cent in the previous year.

The lacklustre performance in agriculture has forced the government to lower the estimates of wheat and rice production to 72.5 million tonnes against the initial estimates of 74 million tonnes.

The manufacturing sector grew at 11.3 per cent against 9.1 per cent while construction took a breather to 9.4 per cent against 14.2 per cent last year.

The financing, insurance, real estate and business services continued to perform well, logging in 11.1 per cent growth against 10.9 per cent.

The 9.2 per cent GDP growth is projected on top of 9 per cent for 2005-06, taking the growth to over 9 per cent for the second year running.

There was a marginal improvement in mining and quarry to 4.5 per cent from 3.6 per cent last year.

The GDP at factor cost (1999-2000) prices is likely to reach Rs 28,44,022 crore in 2006-07 as against quick estimates of Rs 26,04,532 crore for 2005-06.

The estimated growth in GDP for the trade, hotels, transport and communication sector during 2006-07 is placed at 13 per cent.

Expressing happiness over the GDP growth touching a new high, Finance Minister P Chidambaram asserted that it is reforms that are driving growth and that the UPA Government will accord priority to investment across all sectors.

“Reforms have brought in investment, fostered competition and enhanced productivity and efficiency. The government will continue to accord highest priority to investment — domestic and foreign, public and private - across all sectors,” Mr Chidambaram said.

“Growth is a function of investment; and investment is facilitated by flexible, timely and progressive policy responses in a dynamic and competitive global economy,” he said.

Pointing that high growth has also brought in more revenues, he said “these revenues are being allocated to crucial social sectors like education, health, child care and employment guarantee programmes.”

Noting that the agriculture sector has registered lower than the desired growth rate of 4.0 per cent, the Finance Minister said “It may be noted that in the base year (2005-06), the growth rate was at a high of 6.0 per cent.”

As far as manufacturing and services sector, he said, during the three years of the UPA Government, both these sectors had seen acceleration from year to year.

While growth rate in manufacturing sector has accelerated from 8.7 per cent to 9.1 per cent and further to 11.3 per cent, the services sector has recorded growth rates of 9.6 per cent, 9.8 per cent and 11.2 per cent, respectively, in the past three years of the UPA rule, Mr Chidambaram said.

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