Terming the gross domestic product calculation methodology an ‘imprecise science’, Confederation of Indian Industry on Wednesday pegged the country's economic growth at around 8 per cent for the current fiscal, higher than the Reserve Bank of India's projection of 7.6 per cent.
"We expect GDP growth of around 8 per cent in 2016-17.
“Now you may compare this with 7.6 per cent that the RBI forecasts for 2016-17.
“I can only point out to you that the way in which GDP is calculated is somewhat imprecise science," new CII President Naushad Forbes told reporters.
He termed strong macroeconomic fundamentals, favourable business sentiments, and downward trend in interest rates are significant positives for the economy.
The Reserve Bank on Tuesday forecast a 7.6 per cent growth for the current fiscal on the back of favourable monsoon, a notch lower than the upper end of government's range of 7 per cent to 7.75 per cent.
Besides, on the country's ease of doing business scenario he said, "more needs to happen without question".
"The Prime Minister has said that we need to be in the top 50 world-wide so we have a lot to do to get to the top 50 countries in terms of ease of doing business," Forbes said.
The CII President highlighted the need to focus on regulatory mechanisms and the various regulators who sometimes ‘operate in a manner that is somehow counterproductive with the ease of doing business intentions’.
Moreover, he said, much needs to be done to simplify tax administration and enable greater transparency on how it gets implemented on the ground, and the need to expand advance ruling systems so that they cover more and more sectors.
Noting risk factors, Forbes said that the external demand situation would have to be closely watched.
A flat corporate performance, fiscal pressure from the Seventh Pay Commission and potential increase in oil prices in the coming year would be further risk factors.
Employment generation and entrepreneurship are imperatives to address inclusiveness of the growth process, Forbes said.
He observed that initiatives such as Standup India launched on Tuesday by the Prime Minister would create new opportunities for inclusive growth.
He also outlined CII initiatives in this critical area.
The image is used for representational purpose only. Photograph: Reuters
