NEW DELHI: Government is sticking to its estimate of the economy expanding by 6.5-7% during the current fiscal year, in line with the projections made in the Economic Survey, and does not see significant downside risks to growth.
“We started the year with estimates in the economic survey of 6.5-7%. I don’t see any significant downside risk to this… the numbers in the second quarter do indicate that some of the products or some of the services may not be at the same level where they were about a year back or even two quarters earlier. But thereafter, you look at some other indicators… e-way bills or (GST) e-invoices in the month of Oct, they tell a different number. That does not indicate that there is any significant possibility of any downside risk from 6.5-7% estimated at the beginning of the year,” economic affairs secretary Ajay Seth said at a Ficci event on Wednesday.
The comments come ahead of Q2 GDP data release on Oct 29 and amid concerns of softening urban demand for automobiles, consumer goods and durables.
Seth also maintained that inflation, barring a spike in prices of some food products due to an extended monsoon, was not a concern.
Asked about Centre’s capex being lower than the budgeted level of Rs 11.1 lakh crore for the current fiscal year, the top civil servant said: “Last year, capex was Rs 9.5 lakh crore, this year it is budgeted at Rs 11.1 lakh crore. There may be some undershooting but there will be a significant increase over last year. Some sectors are a bit slow, but there is additional demand coming from a few other sectors. I don’t see a major issue coming up. Even last year, it was budgeted at Rs 10 lakh crore and expenditure was around 95%. This year also it should be around the same (level).”