Credit Suisse bullish on India's growth

New Delhi, July 13 (UNI) Leading global bank Credit Suisse today said it is bullish on the performance of India and is expecting a GDP growth of 8.5 per cent in the country this year.

The bank was positive on the country's investment growth but said rising interest rates and inflation would remain the main concerns.

The industrial production data will continue to show strong growth across the basic, consumer and intermediate goods sectors, it added.

Credit Suisse predicts that Asia's projected growth in 2006 and 2007 will remain robust despite tougher external conditions.

Strong domestic demand in almost every country in the region will underpin GDP growth. The bank has revised upwards its GDP forecast for Asia, excluding Japan to 7.8 per cent from 7.7 per cent for 2006, and to 7.5 per cent from 7.4 per cent for 2007.

The revision reflects stronger than expected domestic spending in Indonesia, Singapore and Hong Kong, while India and China continue to be the dominant drivers of growth in the region.

The bank has, however, adopted a negative view on the external environment caused by a continued slowdown in US consumption. But, said the growth momentum for Asia ex-Japan will remain strong in the second half of 2006.

''In China, we are sticking to our 10.1 per cent GDP growth forecast for 2006, with 9.8-10.0 per cent growth projected for the second half of the year,'' said Credit Suisse Chief Regional Economist for Asia ex-Japan Dong Tao said.

Exports are likely to soften amid weakened US consumption, which should keep Beijing away from drastic tightening, but robust consumption and large investments in infrastructure should offer a cushion for sustained growth, he added.

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