The year closed with good economic news all round, except on revenue receipts. While the economy grew 6.6 per cent during the second quarter of 2004-05, compared with 8.6 per cent during the corresponding period last year, the 0.8 per cent dip in farm output due to a deficient monsoon was not as bad as feared earlier.
According to the Central Statistical Organisation, GDP grew 7 per cent during the first half of the year, against 6.9 per cent in the corresponding period last year.
Despite the slowdown in agriculture, the manufacturing sector continued to provide cheer, clocking 9.3 per cent growth in the second quarter, up from 7.4 per cent in the corresponding period last year.
Finance Minister P Chidambaram has said despite a slowdown, India will remain one of the world's fastest growing economies.
Foreign institutional investors seem to share this view. They pumped in a record $8.5 billion in the Indian equity market this year. And foreign direct investment in January-September 2004 rose 54 per cent to $3.04 billion.
Amid the overall buoyancy, the benchmark Bombay Stock Exchange Sensex closed above 6,600 today. The Sensex surged 80 points to its highest close on the last trading day of the year on expectations of strong earnings growth and robust foreign fund flows next year, brokers said.
The Sensex has gained 13.08 per cent in 2004, on top of the 72.9 per cent in 2003. At today's close, the Sensex is a tad short of doubling its level on December 31, 2002.
The National Stock Exchange's S&P CNX Nifty has more than doubled from 1,093.50 on December 31, 2002, to 2,080.50 today. In the futures and options market, the notional turnover doubled from Rs 1,373,000 crore (Rs 13,730 billion) in 2003 to Rs 2,606,000 crore (Rs 26,060 billion) in 2004.
The rupee, too, gained 0.63 per cent on Friday to end 2004 at its highest finish in over five years on expectations of more foreign money pouring in. It has gained 5.31 per cent in 2004 from 45.59 in January 2004.
The rupee closed at 43.48/49 per dollar, against Thursday's 43.7250/7350. This is the highest close since December 9, 1999, when the rupee closed at 43.4500/4550.
The rupee has recorded gains for the third straight year, having risen 5.2 per cent in 2003 and 0.6 per cent in 2002.
Prices seem to be under check with the wholesale price index-based inflation falling for the third consecutive week to 6.5 per cent in the week ended December 18 from 6.73 per cent in the previous week.
Inflation, however, was a worry during the year, having touched 8.7 per cent in August as international crude oil prices neared $60 a barrel.
There is serious concern over revenue receipts, which touched 97 per cent of the Budget estimate at the end of November. Revenue receipts of Rs 1,49,061 crore (Rs 1490.61 billion) during April-November, were 48.2 per cent of the Budget estimate against 54 per cent in the corresponding period last year.
Tighter expenditure control meant that at the end of November, the Centre's fiscal deficit was limited to 51.5 per cent of the Budget estimate, against 61 per cent in the corresponding period last year.
The Centre's expenditure of Rs 2,64,403 crore (Rs 2644.03 billion) during the first eight months of the fiscal year amounted to 55.3 per cent of the Budget estimate of Rs 4,77,829 crore (Rs 4,778.29 billion).