Economy News Notes

Prime Minister's Economic Advisory Council (PMEAC) Chairman C. Rangarajan stressed on the need to focus on reducing the overall level of subsidies as a proportion to gross domestic product (GDP) through an appropriate road map to reach the Fiscal Responsibility and Budget Management (FRBM) target of 3 per cent of GDP.
He also expected the GDP growth rate to be in the range of 7-7.25 per cent during 2011-12 as against the 8.4 per cent registered a year ago, given the industrial slowdown and the global economic crisis.
- The global situation had affected the balance of payments situation and the rupee due to reduced inflow of capitals.
He expected inflation to come down to 7 per cent by March-end.
- But as and when the complete process of regularisation of petroleum products was completed it would impact the overall inflation, he pointed out.
- He underlined the need to use all policy instruments like interventions in foodgrains market, monetary and fiscal policy to bring down the current inflation to the comfort zone of 5 per cent.

Unveiling the ‘Comparative Rating Index of Sovereigns' (CRIS) on the basis of sovereign ratings of various countries compiled through rating data of Moody's and GDP (gross domestic product) data of the International Monetary Fund (IMF), Chief Economic Adviser Kaushik Basu said, in relative terms, India has become a better investment destination by 5.06 per cent.
In terms of CRIS, which takes into account the GDP and rating data of 101 nations, India's rank moved up from 61st position in 2007 to 55th in 2011.
- The improved score, Dr. Basu told reporters, was partly due to the decline in scores of some European nations, leading to deterioration of the world average by over 4.8 per cent.
As per CRIS, Paraguay, Indonesia and Peru were the countries that posted the maximum increase in their ratings between 2007 and 2011 while Portugal, Ireland and Pakistan witnessed the biggest fall in the index.