C. Rangarajan, an economist turned Rajya Sabha member and former Reserve Bank Governor, said that India's economy would recover in the second half of 2009 and would witness significant improvement in growth in fiscal year 2010-11.

Rangarajan said India's GDP would be slightly below 7% for the fiscal year 2008-09. The Central Statistical Organisation's advance estimate of GDP in February was 7.1%.

He said that the global financial crisis, along with liquidity crunch, has made it difficult for Indian companies to borrow funds from global markets, apart from exerting pressure on the domestic banking system.

He also said that the measures taken by the RBI to ease liquidity has not reached the ground level and stressed the need for RBI to take further measures from time to time. The apex bank is scheduled to announce annual credit policy on April 21.

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