Good monsoon, reforms will drive 8% growth: Panagriya

The Dollar Business Bureau

NITI Aayog Vice-Chairman Arvind Panagariya has said that a good monsoon, reforms and good decisions in a timely manner by the Government of India will definitely drive the country’s growth above the mark of 8% in the following quarters of this financial year.

“I am confident that it (GDP number) will be over 8 percent in subsequent quarters (this fiscal),” Panagariya said.

He briefed, “Besides a good monsoon, this will be achieved as a result of the reforms. We have not yet seen the effect of reforms. Earlier, there were grave issues of governance. The projects were stuck and the decisions were not taken by the government.”

The growth rate of India dropped to one and a half year low of 7.1 percent in the quarter of April-June because of subdued performance in the construction, mining and farm sectors. In the quarter of January-March, the rate was 7.9 percent. In the April-June period last year, the country’s economy had grown at a rate of 7.5 percent.

Panagariya admitted that the rate of 7.1 percent in the first quarter was a weak-dampener and said, “It was a little lower than what I expected. The data of first quarter did not have any effect of this year’s good monsoon.”

The country’s foodgrain production in the kharif season of 2016-17 crop year (July-June) is estimated to increase by 9 percent an all-time high of 135.03 million tonnes due to record output of pulses and rice following good rains.

Last year, in the kharif season, the foodgrain output stood at 124.01 million tonnes.

Higher production of pulses will also help in cooling down the retail prices that are continue to be a concern. India’s total foodgrain output had declined to a level of around 252 million tonnes in each of the last two entire crop years, which include kharif as well as rabi season, because of drought for two consecutive years.