Trend in industrial production still negative

Economy Bureau
Posted: Tuesday, Jan 13, 2009 at 0042 hrs IST
Updated: Tuesday, Jan 13, 2009 at 0042 hrs IST

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New Delhi: who are urban focused,” he observed.

While the Centre has been keen on increasing infrastructure spend to maintain the growth momentum in the current downturn, industry says much more needs to be done to translate that into reality. “The government has not demonstrated any meaningful action on the ground to push public expenditure on infrastructure, which was expected to be one of the key stimulus in re-powering the economic engine,” said Vinayak Chatterjee, chairman of infrastructure consultancy firm Feedback Ventures.

Analysts said it typically takes 9-12 months for monetary policy changes to take effect, but fiscal policies need to be implemented urgently for results from the stimulus. Rajiv Kumar, director & chief executive of Indian Council for Research on International Economic Relations, points out that the rural market forms only 18% of the country’s GDP. He also said the unemployment rate was increasing and added that SMEs are becoming increasingly unable to make fresh investments. Kumar said the poor growth in industrial production was likely to continue up to this fiscal end and beyond. ...

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