The council also predicted the annual inflation rate based on wholesale prices, which was estimated at 10.5 percent for June, to fall to around 7-8 percent by December and and further to 6.5 percent by March next year.
“We predict the agriculture sector to grow at 4.5 percent, industrial production at 9.7 percent and services by 8.9 percent this fiscal, for an overall growth of 8.5 percent,” C. Rangarajan, chairman of the council, said.
“The 4.5 percent growth in agriculture after a decline of 0.2 percent last fiscal is, of course, on the presumption of normal sough-west monsoon,” Rangarajan, a former governor of India's central bank, said at a press conference here.
The country's gross domestic product had expanded by 7.2 percent last fiscal and 6.7 percent the year before, after a fast-paced expansion of 9.2 percent, 9.7 percent and 9.5 percent in the preceding three years, respectively.
The remarks by the chief of the high-profile council comes a day ahead of the mid-term appraisal of India's 11th Five Year Plan by the National Development Council, the country's top policy forum, led by Prime Minister Manmohan Singh.
The Planning Commission, which will host the meeting, to be also attended by all state chief ministers, has already conceded that the target of 4 percent farm sector growth during the tenure of the plan period (2007-12) will prove illusive.