"The core sector performance does give some sign, the demand on the part of industry is not so strong, so I would say that clearly the economy has bottomed out, but we don't have strong enough signal yet of recovery. But I am hopeful that the second half of the fiscal would be better," Ahluwalia told reporters in New Delhi at Shiv Nadar Foundation function.
The economy had grown at a decade-low rate of 5 percent last fiscal. The Gross Domestic Product Growth (GDP) in the first quarter of this fiscal (April-June) slowed down to 4.4 percent from 4.8 percent recorded in January-March, 2013.
Ahluwalia's comments came after government data showed that the core sector industries recorded 8 percent growth in September, the fastest in past 11 months.
This pace of growth, however, is lower than the 8.3 percent rise that was recorded in September 2012.
About the recent hike of short term lending rate by 0.25 percent to 7.75 percent last month by RBI, he said, "RBI has handled it (situation) very well. Whenever you are dealing with the difficult situation, you should get back to normal."
Like RBI, Ahluwalia, also agreed with the proposition that India is not comfortable on the inflation front. However, he made a case for stimulating economic growth.
According to him, the GDP growth is very tepid at the moment and it is a difficult balance that the country has to strike between boosting growth and taming inflation.
Supporting Kirit Parikh panel's recommendations, the Plan panel chief said, "The issue of whether we should adjust price of petroleum products and phase out subsidy, there is no doubt (on) that. At least, the Planning Commission has been of the view that this must be done."
Recently, the panel has suggested that diesel prices should be hiked by a steep Rs 5 per litre, kerosene by Rs 4 a litre and cooking gas (LPG) rates by Rs 250 per cylinder immediately to cut fuel subsidy bill by Rs 72,000 crore.
Ahluwalia said that it (price hike) cannot be done immediately. Even if it is not done immediately, the necessary action should be taken quickly, he added.


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