India’s government sees the economy expanding 11% in the year starting April, helped by vaccine drives to tame the coronavirus outbreak and aided by low interest rates that will spur business activity.
The rebound will follow an estimated 7.7% contraction in gross domestic product in the year ending March, according to the Economic Survey — an annual report card on the economy — tabled in Parliament by Finance Minister Nirmala Sitharaman Friday.
The projection forms the basis of drawing up budget proposals which will be unveiled by Sitharaman on Feb. 1. The forecast for next year is in line with the International Monetary Fund’s estimate for 11.5% expansion, which will once again make India the fastest-growing major economy in the world ahead of China’s8.1% pace.
While the government is likely to miss its fiscal deficit target of 3.5% of gross domestic product this year, the survey said there’s need for more sustained and calibrated measures to facilitate the process of economic recovery in the new fiscal year.
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