Rating agency Crisil on Monday said that the GDP growth for 2003-04 is likely to be at 6.4 per cent, as against an advance estimate of 4.4 per cent for the last fiscal.

The acceleration, according to the agency, is predominantly due to the low base in the last fiscal.

Crisil has assumed that monsoons would be normal and is expected to rebound sharply with a projected growth of 6.8 per cent as against an expected decline of over 3 per cent in the last fiscal.

Crisil has projected the average rate of inflation in the fiscal in the 4-5 per cent range.

"Poor rains are pushing up primary commodity prices and the industrial recovery is boosting manufacturing prices. Our assessment is that all these drivers will weaken in the coming months, so we do not see this pressure persisting very long in the year," Crisil said.

Crisil does not expect the industry to grow at more than 5 per cent during the year as against an expected growth of over 6 per cent in the last fiscal. However this growth was over a low base in the previous year.

"Unless there is significant acceleration in the growth drivers, the 'base effect' implies that there will be a slowdown this year.

While the drivers, mainly construction, will persist during the year, there is no clear sign that they will accelerate. Therefore, the base effect will dominate, forcing industrial growth down in comparison with the year just completed," Crisil. It added that high oil prices will have a short term dampening effect on the industrial output.

Although there are signs of ongoing recovery broadening, Crisil said that it is too early to conclude that it is sustainable.

Also investment is yet to show any signs of pick up. According to Crisil, sectors like textiles, which had done well on the back of an export boom, may suffer from the sluggishness in the US economy.