Is the era of high growth rate over for India?

Tag : Agriculture Machinery Component


The use of leading indicators for forecasting GDP growth is part ofthe ongoing work at the Indian Council for Research onInternational Economic Relations (Icrier). Icrier had predicted agrowth of GDP at 9.2% for 2007-08 in November 2007. Most of theagencies had predicted a lower growth rate of 8.5% or below forlast year as against the actual growth rate of 9%.

For constructing the index of leading economic indicators (LEIs),following eight indicators have been selected: (i) production ofmachinery and equipment, (ii) sales of heavy commercial vehicles,(iii) non-food credit, (iv) railway freight traffic; (v) cementsales, (vi) sales of the corporate sector, (vii) fuel and metalprices, and (viii) real rate of interest.

A composite index for the leading economic indicators has beenconstructed for the period 1997-2008 with the quarterly series ofgrowth of these variables (except for the real rate of interestwhere the level, and not the growth, has been used) using.