Centre cautiously optimistic on growth

New Delhi : India’s economic outlook for the coming months is ‘cautiously optimistic’, with agriculture likely to benefit from favourable monsoon conditions, increased minimum support prices and adequate supply of inputs, the Finance Ministry said in a report.

“Bright agricultural production prospects make the inflation outlook benign, despite existing price pressures in select food items,” the October edition of Monthly Economic Review released by the Department of Economic Affairs on Monday said. Early November trends signalled moderation in key food prices, though geopolitical factors may continue to impact domestic inflation and supply chains, it said.

A bumper Kharif harvest is expected to lower food inflation in the coming months, it said, adding that a favourable monsoon, adequate reservoir levels and higher minimum support prices are likely to boost Rabi sowing and production. Amidst a clouded global background, and after a brief period of softening momentum over the monsoon months, the report said, many high-frequency indicators of economic activity in India have shown a rebound in October. These include indicators of rural and urban demand and supply side variables like Purchasing Managers’ Index and e-Way bill generation, it said. On the employment front, it said, the formal workforce is expanding, with notable increases in manufacturing jobs and a strong inflow of youth into organised sectors.