FY12 GDP may miss Govt projection: FM

India’s GDP growth in the current fiscal year will be lower than the Government’s earlier projection owing to hardening spiraling inflation, interest rates and global turmoil, Finance Minister Pranab Mukherjee said on Wednesday. "Most of us are expecting India's growth to go down below 8 percent. This is disappointing," Mukherjee told a news conference. "But if we can, we must not lose perspective of the global situation. There is slowdown all over the world."



"Let me not hide the fact that I have been disappointed by our growth components over the last few months. It is evident that India's growth rate in 2011-12 will be less than what we presented in February when I presented the budget." India's GDP growth for FY12 was initially estimated at 9% but the Government, the RBI and other independent economists have scaled down their projections gradually. The economic growth is now forecast to be anywhere between 8% to 8.5%. In fact, a few private think tanks are predicting below 8% GDP growth in the year ending in March 2012. The Finance Minister also said that it will be a challenge to meet a target to lower the Government’s budget deficit to 4.6% of GDP. He was speaking at a media briefing in New Delhi. Mukherjee said that he expects inflation to decline from December and be around 7% by March-end. Separately, R. Gopalan, secretary in the Department of Economic Affairs in the Finance Ministry, said that India’s debt to GDP ratio may be at 44.2% for the year ending in March. He also said that the Centre was confident of achieving its target of raising Rs. 400bn through stake sale in public sector enterprises this fiscal year. A Finance Ministry official was quoted as saying in New Delhi today that the Government doesn’t see any need for additional borrowings above the proposed Rs. 2.2 trillion in the second half of the year ending March 31.