NEW DELHI: Domestic macro fundamentals remain strong and are improving but downside risks arise from global headwinds and uncertainties in weather conditions, the finance ministry’s monthly economic report for September said.
The report, which was released on Monday, said that global uncertainties have been compounded by recent developments in the Persian gulf. Depending on how the situation develops, crude oil prices may push higher. “Fraught geopolitical conditions can cause a general increase in global risk aversion. If these risks worsen and are sustained, they can affect economic activity in other countries, including India,” according to the report.
It said that strong private consumption demand has been a major driver of India’s economic growth in the recent period. In addition, at least two more drivers of growth have emerged. The first is the gradual strengthening of investment demand. Investment has, hitherto, been propelled mainly by the capital spending of the Centre and the crowding-in it induced for private corporate investment.
The report said that increasing demand for residential properties, suB
