New Delhi, Jan 20: Surging inflation and slowing growth are raising serious concerns about the future growth prospects of the economy and as a remedial measure the government should resolve supply-side hurdles and ensure more stringent governance norms, a report said on Monday.
According to the Dun and Bradstreet Economy forecast, even though the Index of Industrial Production (IIP) turned positive in November 2019, it is likely to remain subdued.
"Slowdown in consumption and investment along with high inflationary pressures, geopolitical issues and uncertainty over the recovery of the economic growth are likely to keep IIP subdued," the report noted.
Dun and Bradstreet expect IIP to remain around 1.5-2.0 percent during December 2019.
As per government data, industrial output grew 1.8 percent in November, turning positive after three months of contraction, on account of growth in the manufacturing sector.
On the price front, uneven rainfall along with floods in many states and geopolitical issues have led to a surge in headline inflation even as demand remains muted.
The Consumer Price Index (CPI) in December rose to about five-and-half year high of 7.35 percent from 5.54 percent in November, mainly driven by high vegetable prices.
"The sharp rise in inflation has constrained monetary policy stimulus while revenue shortfall has placed limits on the government expenditure," Dun & Bradstreet India Chief Economist Arun Singh said.
According to Singh, growth-supporting measures and deceleration in growth are likely to cause slippage in fiscal deficit target by a wider margin.
"The government should focus on taking small steps to address the slowdown; in particular, resolve the supply-side hurdles and ensure more stringent governance norms," Singh said.
Unless these concerns are addressed through a comprehensive policy framework, it will not be easy for India to clock a sustainable growth rate to become a USD 5 trillion economy, he added.
Comments
Haj subsidy was used to fleece the Muslim Pilgrims. I am sure the Haj tickets are much cheaper.
dear Hassan, dont bother yourself with airfare calcuations. This Naqwi is a stupid parallysed minister of BJP-RSS group. Though he has tongue but he cant speak his own, he has to be feeded by his superiors and spit the same. who the hell he to decide the number of piligrims to perform Hajj, is KSA is fathers property? he is thinking we Indian Muslims are stupid? i doubt he is a muslim (he is not). for your info, dont calculate airfare and expenses which is bound to occur during this holy deed. Islam has clearly emphasized "Hajj shall be performed for healthy and wealthy slaves" lets Ask Allah to all of us blesssed to reach that holy place and paerform our Hajj in sha Allah. Government subsidy is my foot....
He think he and his party fool people in each and every occations. What ever the quota saudi government provides, that much people will go to Hajj every year depend upon the Quota.
Record number of pilgrims ...without subsidy is a slap on you and Modi government.....
Mr mininster, We dont want Subsidy But please compare the air fare now and during HAj season. If you control on that then people will realise that you had did something positive. Airfare regular price from mumbai to jeddah is around Rs 25000/- But during Ramadan and Hajj seoson its crosses more then Rs 75000/- Differrence is more then what government was giving Susidy. So dont fool the nation. Keep control on Air fare. Jai hind
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