i Develop Stocks Advisory

GDP growth likely to moderate to 8.7 per cent in FY-08 Country's economic growth is likely to moderate to 8.7 per cent in the current fiscal due to slow expansion in industrial output, which is hit by high interest rates, and sluggish agriculture. The Gross Domestic Product (GDP) had grown at 9.6 per cent in 2006-07, which was the highest in 18 years. "GDP at factor cost at constant (1999-2000) prices in the year 2007-08 is likely to attain a level of Rs 31,14,452 crore as against Rs 28,64,310 cr ore in 2006-07,'' according to the advance estimates of national income released by the government on Thursday. The GDP grew at 9.1 per cent during the first half of this fiscal. It grew at 9.3 per cent in the first quarter and 8.9 per cent in the next three-month period. The advance estimates showed a further moderation during the rest of the year. The estimated growth rate is slightly higher than the conservative RBI projection of 8.5 per cent, but less than 9.1 per cent, projected by economic think tank NCAER. The Finance Minister, Mr P Chidambaram had earlier exuded confidence that the economy will grow close to 9 per cent during 2007-08. High interest rates have pushed up cost of producing industrial goods and reduced demand for consumer goods, affecting ma nufacturing growth. The manufacturing sector is likely to grow at 9.4 per cent during the fiscal as against 12 per cent last year. The advance estimates revealed that agri and allied activities are likely to expand at 2.6 per cent as against 3.8 per ce nt in the previous year. - PTI