2010 FORECAST - IMF upgrades India growth to 9.4%..........

The International Monetary Fund (IMF) has raised India's economic growth forecast for 2010 to 9.4%, continuing to surprise the government and other economists with its optimism.

This is IMF's third consecu- tive quarterly upward revision since October 2009. The growth projection for calendar year 2010 has been revised up- wards by three percentage points since then. One basis point is one-hundredth of a percentage point.
“I notice that the IMF has re- cently challenged our predic- tion,“ finance minister Pranab Mukherjee had said on 22 June, referring to the April 8.8% growth forecast. “For once, however, I am not going to argue with the IMF.“
The government's own eco- nomic growth projection for the year to March 2011 is 8.5%.
According to IMF, India's growth is likely to be driven by corporate investment on ac- count of strong profitability and the easier availability of credit. The international body didn't give further details on the reasons for its optimism in the report, part of the World Economic Outlook. IMF's India economist could not be reached for comment.
The finance minister's senti- ments were echoed by another government official after the latest number was announced.
“It comes as a bit of sur- prise,“ Pronab Sen, principal adviser to the Planning Com- mission, told Mint. “To me, it looks as a bit of overestima- tion,“ added Sen, who was the government's chief statistician till last month.
India's Central Statistical Organisation had said in May said that growth in the January-March quarter was 8.6%.
According to Sen, the sec- ond and third quarters of cal- endar year 2010 will register higher growth partly on ac- count of lacklustre perfor- mance in the corresponding periods of the previous year.
Subsequently, the growth rate could decelerate as the advan- tage of a low base would disap- pear.
Another economist associat- ed with the government, who did not want to be named, said a possible reason for IMF's current optimism was because the agency had begun to “back-pedal“ from an earlier assumption.
IMF had estimated previous- ly that the credit squeeze in Western finan- cial markets would have a far greater im- pact on the In- dian industry, the economist said. Once it became appar- ent that the agency's initial assumption was incorrect, there have been sharp upward revisions, he added.
Between April and July, IMF has raised its forecast for In- dia's economic growth by 60 basis points.
Along with India's growth forecast, IMF has also revised China's estimate upwards, helping nudge up the global estimate.
It has forecast that the global economy will expand at 4.6% in 2010, against the 4.2% estimat- ed in April. While advanced economies are expected to reg- ister a growth rate of 2.6%, emerging and developing economies are projected to grow at 6.8%. China's economy is expected to grow at 10.5%, an estimate that has been raised by 50 basis points since April.
IMF, which retained India's 2011 growth forecast at 8.4%, has hedged its current esti- mates by pointing out that there remain sharp downside risks on account of weaknesses in developed economies.
It cautioned that further spikes in global risk aversion, especially in the euro zone, could precipi- tate capital outflows from the Asian re- gion and weaken equity valuations.
That could, in turn, under- mine favoura- ble financing conditions and domestic de- mand.
A delay in the European re- covery may also impact Asia through both trade and finan- cial channels, it said.
Still, the impact of euro zone volatility would be muted, IMF said.
“Asia has only limited direct financial linkages to the most vulnerable euro area econo- mies, but a stall in the Europe- an recovery that spilled over to global growth would affect Asia through both trade and fi- nancial channels,“ it said.
My Comments:
Now IMF is putting higher growth for India and that too above 9%.........
India is going to be a GAS surplus country and due to that the import bill of Oil is going to come down drastically which is going to help India in a huge huge way..........
And hence I feel even at current market price(cmp)Gail Ltd ,BPCL, HPCL are extremly excellent for LT holding......
Other stocks having stake in Gas field and gas sector also will have good days ahead,Viz:IOC, IOL,Ril Ind,Gujarat Gas, Cairns India etc and Gas compressor stock like Deep Ind , my old call, will also have its time.
Stocks like DHP India Ltd , Gas cylinder and gas kit making Cos like Minda Ind, again my old call around 130 will be star performer in future......
Keep or buy these above stocks for LT.......Except Cairns India I have time and again recomended all the above stocks....way way ahead of market can identify........or understand what is coming up....
I again repeat, don't get afraid if prices goes down after you buy.That happens with everyone including me......Hold them with conviction and you will get excellent return.
These are my views and I can prove wrong.........in my analysis.....take your own call.....

Updates:
One of the reader pointed me out I missed Essar Oil and yes, that comes in same category......I missed to write Essar Oil Ltd.....
I can add here  GSPL  as well ......and ofcourse HOEC, the RJ counter....