Financial Express cited Mr C Rangarajan Prime Minister's Economic Advisory Council chairman as saying that the economy is expected to grow at 5.5% to 6% in the current fiscal and the next year will see a better rate of expansion.
Mr Rangarajan on the sidelines of the Delhi Economics Conclave said that "I think the overall growth rate of the economy will be between 5.5% to 6%."
Growth in the H1 of 2012-13 has fallen to 5.4% from 7.3% in the same period last fiscal. For the entire 2011-12 fiscal, the growth had declined to 9 year low of 6.5%. Meanwhile the Reserve Bank expects it to be 5.8% in the current fiscal.
He said that "The economy will do better in the second half. I think the manufacturing sector could grow at about 3% this fiscal."
He added that the reforms are again back on the forefront and many measures have been taken. Therefore, I believe the sentiment is already changing. Going forward, the investment will pick up and we will see this particularly next year.
In the recent past, the government has taken a number of measures, including opening up of FDI in multi brand retail and hiking foreign investment cap in the aviation sector, to boost economic growth and restore investor confidence.
He said that "I think RBI has expressed the intention that if the trends are in the right direction they will definitely act from January. Whether they will act now or not I am not sure."
RBI is scheduled to announce its mid quarter review of the monetary policy on December 18th.
In the last policy review in October, RBI had left repo rate at which it lends to banks unchanged.
