The strengthening of economic activity has been supported by persistent increase in domestic investment rate from 22.9 per cent of GDP in 2001-02 to 33.8 per cent 2005-06 coupled with an efficient use of capital. It must also be noted that over 95 per cent of investment during this period was financed by the domestic savings only.
Domestic saving rate has also improved from 23.5 per cent to 32.4 per cent over the same period. The contribution to improvement in savings has come both from private corporate sector and public sector. Inflation While growth has picked up, over the years, inflation rate has been moderated to lower levels ensuring price stability.