The Indian Economy posted a robust GDP growth of 8.2% in 2003-04.

Agriculture output during Q4-2004, although lowers than Q3, but is higher than Q1 & Q2.

Industry posts higher growth over previous quarters.

Services sector growth dips further to 7.6% in Q4-2004.

Inflation

Manufacturing sector registered the highest levels of inflation with the rates surging above 6.0% in the first quarter 2004-05.

Index for Fuel, Power, Lights and Lubricants category posts a hike due to fuel price rise.

Foreign Exchange

India’s foreign exchange reserves approximately stand around $120 billion, which are adequate for import cover of 20 months.

Expected Outlook in 2004-05

Expected GDP growth for 2004-05 around 7%.

Clear overall demand growth.

Order books of companies better than before; companies have a strong outlook.

Rising rural demand - the recent budget announcements to give further boost.

Upturn in investment cycle; manufacturing.

INDIA’S NEED FOR A STRONG MANUFACTURING SECTOR

Following table shows a sharp slow down in the growth of manufacturing sector: -

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* Contributed by -
Varun Gupta,
B.E. (Electronics), Mumbai University,
MBA, ICFAI University, Hyderabad,
Currently working as Business Analyst with NSE.IT Ltd., Mumbai.