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30 November 2017
 |
| Growth (The Total Investment & Insurance Solutions) |
India's economic growth pace picked up to 6.3
percent in the three months ending in September, halting a five-quarter slide
as businesses started to overcome teething troubles after the bumpy launch of a
Goods and Services Tax (GST). The Total
Investment & Insurance Solutions
Gross
domestic product grew 6.3 percent in July-September, its fastest pace in three
quarters, the data showed. However, the pace of growth was still way below 7.5
percent recorded in the corresponding quarter a year ago.
Growth had slid to a three-year low of 5.7
percent for the three months to June on the spillover effects of the note ban
and the GST implementation.
According
to Central Statistics Office (CSO) data, the economic activities that
registered growth of over 6 percent in the second quarter are manufacturing,
electricity, gas, water supply, other utility services and trade, hotels,
transport and communication, and services related to broadcasting.
The agriculture, forestry and fishing sector
is estimated to have grown by 1.7 percent. The Total Investment & Insurance Solutions
Expressing concern on the GDP numbers,
Finance Minister Arun Jaitley said government’s reforms to push economic growth
are working can be seen from that manufacturing has shown robust growth of 7
percent in Q2 and services at 7.1 percent. The Total Investment & Insurance Solutions
Addressing
a press conference, Jaitley also said, “Last five quarters had witnessed a
downward trend, GDP at 6.3% marks the reversal of that trend. Demonetisation
and GST’s impact is behind us and hopefully, in coming quarters, we can look
for an upwards trajectory.”
Government’s
reforms to push economic growth are working can be seen from that manufacturing
has shown robust growth of 7% in Q2 and services at 7.1%. Gross fixed capital
formation has increased from 1.6% in Q1 to 4.7% in Q2.
Chief
Statistician T C A Anant also said increase in Q2 GDP to 6.3 percent shows
significant trend reversal in growth rates.
GDP growth sector-wise
1.
Agriculture, forestry and fishing: 1.7% vs 2.3% in Q1
2.
Mining & quarrying: 5.5% vs -0.7% in Q1
3.
Manufacturing: 7% vs 1.2% in Q1
4.
Electricity, gas, water supply & other utility services: 7.6% vs 7% in Q1
5.
Construction: 2.6% vs 2% in Q1
6.
Trade, hotel, transport, communication & services related to broadcasting:
9.9% vs 11.1% in Q1
7.
Financial, insurance, real estate & professional services: 5.7% vs 6.4% in
Q1
8.
Public administration, defence & other services: 6.1% vs 5.6% in Q1
In
July-September, auto sales, manufacturing, electricity generation grew more
quickly than in the previous quarter.
On
November 17, Moody's upgraded India`s sovereign credit rating for the first time in nearly 14 years,
saying continued progress on economic and institutional reforms would boost its
growth potential.
It expects the economy to grow 6.7 percent in
the fiscal year ending March 31, and 7.5 percent the following year. The Total Investment & Insurance
Solutions
Modi
government hopes the ratings upgrade can attract more foreign investors, who
pumped USD 15 billion into Indian equities in July-September, up 44 percent
from the previous quarter. The main NSE share index is up 27 percent in 2017.
Still,
the world`s seventh largest economy, which grew at more than 9 percent a year
from 2005 through 2008 is far from firing on all cylinders. Domestic demand and
private investments remain weak.
After
front-loading state spending in the fiscal year`s first half, Finance Minister
Arun Jaitley has limited room to spend amid slowing revenue growth.
Finance
Ministry officials hope the central bank will cut interest rates soon, but
analysts say that rising global oil prices, which could pinch consumers through
higher inflation, may instead force the RBI to hike in the second half of 2018,
denting growth momentum.The Total
Investment & Insurance Solutions
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