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CII asks Govt to provide more stimulus
Commodity Online
MUMBAI: The industry chamber, the Confederation of Indian Industry (CII) asked the government to introduce further stimulus packages so as to prop up worsening economy.
According to a report conducted by CII on State of the Economy, the Indian economy is expected to decline further owing the global economy slowdown and forecasted a growth of below seven percent.
However, it asked the RBI to signal more cut in interest rates, given subdued prices which may fall further during 2009-10. The overwhelming services sector, which remained buoyant despite global crisis, may be hit by decline in overall business prospects.
"However, as business opportunities dry up in sectors such as banking and finance, real estate, trade, hotels and transportation, there is a potential for further slowdown in the services sector," the chamber said.
It further said that only social and personal services are likely to remain buoyant, as it would be driven by the government spending. On growth in investment, CII said recession is likely to result into further deceleration, while the government and private consumption would remain less affected.
The chamber said that inflation, which rose up to 12.9 per cent in August last year, has now come down to about five per cent level. With the decline in global fuel and commodity prices, it is expected that inflation could fall to very low levels or even fall further by June 2009.
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