Economy may grow 5-6% next yr

According to a joint survey by Confederation of Indian Industry (CII) and McKinsey & Co, Indian economy may expand 5-6 percent next year.

Around 32 CFOs from leading Indian companies across sectors including manufacturing, information technology, consultancy and financial services participated in the survey.

The survey also said that the Indian economy’s outlook is ‘cautiously optimistic’ and key enablers to fuel the economic growth include increased FDI, reduced fiscal deficit and enabling corporate growth.

Most respondents of the survey don’t expect the economy to grow beyond 6 percent because of
subdued economic condition in western markets like US and Europe.

Majority of respondents said that the euro crisis, followed by slowdown in the US, as well as increasing oil prices, are expected to have the biggest impact on the Indian economy, it said. The growth rate in the first quarter of this fiscal was 5.5 percent.

In the budget for 2012-13, then finance minister Pranab Mukherjee had projected the economy to grow by around 7.6 percent. Recently, the Reserve Bank of India (RBI), in its half yearly review of the monetary policy, had sharply lowered this fiscal’s economic growth projection to 5.8 percent, from 6.5 percent, in view of global and domestic factors like poor investments and subdued demand.