As we step into 2021, the economy is giving us great news. A CNBC-TV18 poll of economists shows that the gross domestic product (GDP) estimate for the current year has been upgraded to minus 7 percent from the minus 10 percent that was the average estimate a few months back.

Speaking in an interview with CNBC-TV18, Anantha Nageswaran, Member of Economic Advisory Council to the Prime Minister said, “At this stage the odds are more towards a further upgrade of this number; tending towards slightly lower contraction rather than higher contraction. However, for planning purposes we should work with 7 percent contraction real GDP for 2021.”

On the inflation front, Nageswaran said the real problem would be the asset price inflation.

“The real problem will be the asset price inflation and the exuberance it creates leading to mal-investment etc. So I would be more worried about overheating in the Indian economy in a much broader sense,” he said.

Meanwhile, Upasna Bhardwaj, Senior Economist at Kotak Mahindra Bank said, “We have upgraded the GDP forecast earlier from 11.5 percent minus to minus 8.5 percent and that’s where we stand today. There is a probability of a slight upgrade further, but anything beyond 7-7.5 percent looks difficult at this point.”

According to her, core inflation has been sticky and likely to remain so.

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(Edited by : Ajay Vaishnav)