India to keep up 7pc growth rate
Says central bank
Staff Correspondent, New Delhi
The Reserve Bank of India said the Indian economy is poised to keep up the 7 percent growth rate in current fiscal on macro economic gains but cautioned rising crude prices could impact output, inflationary pressure and export competitiveness.In its annual statement released on Monday, the bank warned that high oil prices remained the most critical factor influencing domestic inflation and any complacency in managing price stability could hurt growth. It said inflation is expected to be at around 5 to 5.5 percent if normal circumstances prevail. The central bank virtually suggested a hike in domestic fuel prices and aligning them to global trends. The statement said by not aligning domestic oil prices with global trends, the government's fiscal burden is likely to go up and eventually hurt its finances. "Spikes in crude oil prices could result in increased fiscal burden in terms of duty concessions, larger petroleum subsidies or lower dividends from oil public sector enterprises," it added.
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