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India's economic growth likely to remain in range of 7-7.5% in next few years: EAC-PM

Expressing optimism over growth of Indian economy, the Economic Advisory Council to the Prime Minister (EAC-PM) has said that the country's economic growth is likely to remain in the range of 7-7.5 per cent in the next few years. It added that the growth rate can be easily increased by 1 per cent by addressing structural problems through reforms. Besides, the Central Statistics Office (CSO) in its latest forecast pegged the growth at 7.2 per cent for 2018-19.

The Council strongly feels that there should be no deviation from the fiscal consolidation target but there must be continued emphasis on social sector interventions. It noted that the macro-economic fundamentals of the economy are sound but challenges remain, several of which are structural in nature. It highlighted that while the prospect for world economic growth does not look very promising, particularly in advanced economies, there is sufficient amount of growth momentum in emerging market economies. India is not insulated from global developments, nevertheless, India's growth expected to be in the 7-7.5 per cent range in the next few years.

The panel felt that the exchanger rate management of the rupee by RBI has been sound despite the volatility in price of the crude oil. There are indications that financial savings have started going up and there is credit uptick through private banks to the services sector. The reform in the financial sector should be strengthened further building upon what the government is already doing. It also felt that the challenge of insularity being seen in external trade should be reversed through supportive policy interventions because there is a positive turn in exports that are visible now. It noted that the challenges in the agriculture sector should be addressed by looking closely at the credit flow and support to employment programmes like MNREGA.

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