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India’s economy posts solid recovery

International Business
Fri, 01 Dec 2017

NEW DELHI: India’s economy picked up in the second quarter, official data showed yesterday, rebounding from a sharp slump in the wake of reforms that dragged growth to three-year lows.

Figures from the Central Statistics Office showed Asia’s third-largest economy accelerated after five quarters of slowing growth, as the impact of a sudden cash ban and launch of a nationwide tax receded.

GDP growth rose to 6.3 per cent in the three months to September, slightly below analyst expectations but bucking a slowdown that had persisted since early 2016.

India’s chief statistician TCA Anant described the bounce back as “encouraging” but acknowledged growth over the same period last year was 7.5pc.

Economic growth plunged to 6.1pc for the first quarter of the current financial year before bottoming out at 5.7pc in June.

The slump cost India its title as the world’s fastest-growing major economy.

The central bank last month downgraded India’s growth forecast, as the government sought to allay slowdown concerns.

The International Monetary Fund in October also lowered its growth forecast to 6.7pc from 7.2pc predicted in July.

The Federation of Indian Chambers of Commerce and Industry said “signs of recovery are in sight” and welcomed India’s recent 100th ranking on the World Banks’s ease of doing business index – an improvement of 30 places.

Ratings agency Moody’s also this month upgraded India’s credit rating for the first time in more than a decade.