India's foodgrain production is all set for a record high in 2007-08 at 227.3 mn tonnes, according to Reserve Bank of India's [Get Quote]"Macroeconomic and Monetary Developments in 2007-08" released on Monday.

The report released ahead of the annual policy statement for 2008-09 announcement on Tuesday said that economic growth was placed at 8.7 percent as 9.6 per cent in 2006-07.

According to the Third Advance Estimates for 2007-08, the total foodgrains production is slated to reach an all-time high at 227.3 million tonnes, recording an increase of 4.6 per cent over the previous year (217.3 million tonnes). The production during 2007-08 would exceed the target set earlier (221.5 million tonnes) by 5.8 million tonnes.

Notwithstanding the moderation, the growth performance was in tune with the high average real GDP growth of 8.7 per cent per annum during the five-year period, 2003-04 to 2007-08.

During 2007-08 (April-February) the index of industrial production rose by 8.7 per cent compared with an increase of 11.2 per cent during 2006-07 (April-February). The manufacturing sector recorded a growth of 9.1 per cent during 2007-08 (April-February) compared with 12.2 per cent during April-February 2006-07.

During 2007-08 (April-February), growth of the infrastructure sector was placed at 5.6 per cent as compared with 8.7 per cent during the corresponding period of the previous year, reflecting deceleration in all the sectors, except coal.

The services sector maintained its double-digit growth at 10.6 per cent during 2007-08 despite some moderation in pace. It continued to be the major contributor to GDP growth. Leading indicators of service sector activity for April-February 2007-08 suggest that the growth rates in tourist arrivals, revenue earning freight traffic of the railways, commercial vehicles production, new cell phone connections, passengers handled by civil aviation at domestic terminals, cement and steel moderated over the previous year.

The Indian economy continued to expand at a robust pace during 2007-08 for the fifth consecutive year. The real GDP growth rate was placed at 8.7 per cent in 2007-08 as compared with 9.6 per cent in 2006-07, reflecting moderation in growth in all the three sectors, viz., agriculture and allied activities, industry and services, according to data provided by Central Statistical Organisation.

Gross Domestic Saving, as percentage of GDP at current market prices, was placed at 34.8 per cent in 2006-07 as compared with 34.3 per cent in 2005-06, reflecting improved saving performance by the private corporate and public sectors. On the other hand, the household saving rate declined marginally in 2006-07 from the previous year on account of decline in the financial saving rate.