India’s economic growth expected to grow in FY12.

The global economy is expected to continue to grow at sub-par levels over the next few years due to the uncertainty over the US recovery, sovereign debt crisis in Europe and fragile recovery in Japan. These three economies comprise nearly 50% of the global GDP.

In the backdrop of the global economic situation, it is believed that India’s economic growth will still be a respectable 7.50% for FY12.

In fact, the GDP growth differential between the developed economies and India will widen mainly because of the ring-fencing of the Indian economy from global economic turmoil to a large extent as domestic consumption constitutes more than 60% of our GDP while exports contribute only around 20% of GDP.

It is believed that in the backdrop of a weak global economic outlook, commodity prices should also soften, which could have a favorable impact on the Indian economy.

Source: Multiple
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