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NB 205 Wk 6 Assignment - Reference 1 - Financial Express

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http://www.financialexpress.com/news/Indias-GDP-to-grow-at-9.5-in-FY-09/323499/
'India's GDP to grow at 9.5% in FY 09'
Agencies
Posted: 2008-06-16 18:49:29+05:30 IST
Updated: Jun 16, 2008 at 1849 hrs IST
Mumbai, June 16: : India's real GDP is expected to grow at an impressive 9.5 per cent in
FY 09, the Centre for Monitoring Indian Economy (CMIE) said in its monthly review in
Mumbai.
The Indian economy is heading towards the fourth consecutive year of an over-9 per cent
growth and like in the last five years, growth this year too was expected to be driven by
capital investments happening in India, CMIE said.
As per CMIE CapEx Service, projects worth Rs 3.4 lakh-crore are scheduled for
commissioning in FY 09. This would be the highest-ever completion of investments in
the Indian history, CMIE said.
The capital investment boom in the country drives the current growth phase of the Indian
economy.
India's GDP started rising by over eight per cent since FY 04. And, the gross capital
formation (GSF) grew in the range of 13-23 per cent during this period.
CMIE expects growth in GSF to accelerate to 18.7 per cent in FY 09 from 13.4 per cent
in FY 08. This robust growth in GSF is expected to more than offset the moderation in
the growth in private final consumption expenditure (PFCE) and Government final
consumption expenditure (GFCE).
CMIE stated that the PFCE is expected to grow by five per cent in FY 09, after growing
by 7-9 per cent in the preceding three years. While the slower growth in the PFCE would
mainly be on account of the higher base in 2007, the prevailing high inflation would also
affect the consumption demand to some extent.
However, inflation is not expected to depress the PFCE dramatically as income levels in
India have also gone up significantly in the last one year.

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