India Inc pleads for a cheap money

Industrial growth of in July-September,2010 period came down to 9.8 per cent from 13 per cent in the previous quarter.

Alongside construction,electricity,gas and water supply as well as mining and quarrying have also decelerated in second quarter over April-June period.

“This performance suggests that we should not tighten monetary policy any further,” it said.

Reserve Bank of India is schedule to review the country’s monetary policy next month.

The central bank has increased key policy rates six times this year.

To increase share of industrial production in the country’s GDP,the government is in process of formulating a national manufacturing policy in consultation with different industry chambers like FICCI and CII.

CII too expressed concern on slowdown in industrial production but expressed satisfaction on recovery in agriculture and services sectors.

“As a result,we expect GDP growth to exceed 8.5 per cent in 2010-11,making India one of the fastest growing countries in the world,” CII Director General Chandrajit Banerjee said.

Another leading chamber ASSOCHAM said the impressive second quarter economic growth numbers could help India record an overall GDP expansion of over 9 per cent this fiscal.

“The GDP numbers seem exciting and highly endorse the India’s growth story,” its president Swati Piramal said.

PHDCCI president Ashok Kajaria said given the weakening external demand and the need for fiscal consolidation at domestic front,”sustainability of current economic growth will tilt increasingly on private consumption and investment demand”.