MUMBAI (AFP) — India’s economy may grow at 8.4 percent in the current fiscal year, led by local consumer demand, robust manufacturing and services growth, a central bank survey of economists said Thursday.

The study of professional forecasters conducted by the Reserve Bank of India (RBI) revised India’s economic growth forecast for the fiscal year to 8.4 percent, from 8.2 percent in the previous survey.
This is just below the RBI’s own estimate of 8.5 percent growth by March next year, announced at its policy meeting last month.
The RBI polled 26 economists for the quarterly survey on macro-economic measures such as GDP, inflation, interest rates and credit growth.
The findings are individual estimates of the forecasters, and not of the central bank.
“GDP growth rate forecasts have been revised marginally upwards to 8.4 percent in 2010-11, driven by private consumption growth, stronger industrial activity and further contribution of services,” the survey said.
Inflation, which has become a sticky issue for India’s Congress-led government, may fall to between 6.0 to 6.90 percent by March 2011, from 10.55 percent in June, economists said.
The cost of living in India has remained stubbornly high, with consumer prices being driven by high food costs, rising wages and an expanding economy.
The RBI in July hiked main interest rates twice, and four times in the year, to tame inflation that is souring the experience of economic growth for millions of poor citizens.
India’s inflation rate is now the highest among the Group of 20 economic powers and contrasts sharply with developed nations such as the United States or Japan, where deflation is more of a concern.
The forecasters polled say the RBI may hike the repo -- the rate at which the bank lends to commercial banks -- by a further 50 basis points, to 6.25 percent by March next year.
The reverse repo -- the rate the central bank pays to banks for deposits -- could by raised by an additional 25 basis points in the current fiscal year, to 4.75 percent, they said.
The world’s third-largest economy grew by 7.4% in the fiscal year ended March 31, 2010.