India Inc on Friday expressed the hope that the robust 17.6-per cent industrial growth in April will help the economy grow by 8.5 per cent in this fiscal, even though factory output growth may moderate after June.
"With such strident growth in the industrial sector, GDP growth during 2010-11 can also be expected to reach the 8.5 per cent target," Ficci secretary general Amit Mitra said.
The CII said the stronger-than-expected IIP numbers have raised hopes that the economy will do well in the current fiscal year.
"If the performance of the monsoon is good and inflation moderates, we could see very strong growth in the current year," CII director general Chandrajeet Banerjee said. However, Mitra cautioned that this trend of high growth may moderate from June onwards because of the base effect.
The CII also said as business sentiment has seen a strong revival investment has been buoyant, especially in the manufacturing sector. It also advocated for the need to raise the share of manufacturing to provide greater employment opportunities.
"Our manufacturing economy needs to grow at a sustained rate of 1112 per cent to capture the global opportunity in manufacturing," CII said.
PHDCCI additional secretary general S Kapur too said the IIP numbers have proved that economic fundamentals are strong and the country is gradually catching up with the rate of growth that existed before the economic meltdown.