India logged 7.4 percent growth in 2009-10 (Roundup)

New Delhi, May 31 (IANS) India’s economy grew by 7.4 percent for the financial year ended March 31, propped up by a notable 10.8 percent expansion in factory output, even as farm production lagged behind with a rise of just 0.2 percent, fresh data showed Monday.

The 7.4 percent growth is also an upward revision from the earlier estimate of 7.2 percent, thanks to higher-than-anticipated growth in agriculture, mining and manufacturing sectors, said the Central Statistical Organisation (CSO).

The latest data also showed another rebound by the economy, which had expanded by 6 percent in the first quarter, moved up to 8.6 percent in the second, retarded to 6.5 percent in the third, but again grew robustly by 8.6 percent in the fourth quarter.

Finance Minister Pranab Mukherjee said he expected the growth momentum to continue and the economy would expand at 8.5 percent in the current financial year.

India’s gross domestic product (GDP) had expanded by 6.7 percent during 2008-09.

In contrast, the Chinese economy rose 11.9 percent in the quarter ended March 31, which was the fastest in nearly three years accelerating from 10.7 percent from the quarter ended Dec 31, 2009.

Following are the India economy’s growth rates for 2009-10 for the eight main sectors with figures for the previous fiscal in brackets:

-Agriculture (1.6 percent) 0.2 percent

-Mining (1.6 percent) 10.6 percent

-Manufacturing (3.2 percent) 10.8 percent

-Electricity and water (3.9 percent) 6.5 percent

-Construction (5.9 percent) 6.5 percent

-Trade, transport and telecom (7.6 percent) 9.3 percent

-Finance and realty (10.1 percent) 9.7 percent

-Community services (13.9 percent) 5.6 percent

Prime Minister Manmohan Singh had estimated the GDP growth for the previous fiscal at 7.2 percent as opposed to the revised estimates of 7.4 percent spelt out Monday, but set a much higher target for the current fiscal and for the medium term.

‘We expect 8.5 percent in this financial year,’ the prime minister had said at a press conference last week, adding: ‘Our medium term target is to achieve a growth of 10 percent per annum. I am convinced given our savings and investments rate this is an achievable target.’

Leading chambers such as the Associated Chambers of Commerce and Industry (Assocham) said the last quarter of growth of 8.6 percent in 2009-10 raised hopes that Indian economy will move close to 9 percent expansion in the current fiscal, despite some lingering concerns.

‘The euro crisis as of now does not pose much of a challenge to the Indian economy. If it spreads beyond a point, our external engagements could suffer. But it is sure the current growth momentum will be maintained,’ said Assocham president Swati Piramal.

FICCI president Rajan Bharti Mittal said maintaining high growth in the manufacturing sector will be critical to sustain the high level of growth in 2010-11, adding that rise in interest rates at this point in time will act as a ‘break on the overall growth process.’