Economy scripts a turnaround expands 6.3% in Sept quarter
New Delhi: Reversing a five-quarter slide in GDP growth, Indian economy bounced back from a three-year low to expand by 6.3 percent in July-September as manufacturing revved up and businesses adjusted to the new GST tax regime.
The GDP growth in the second quarter of 2017-18 compares to 5.7 per cent in April-June, the lowest growth rate since the Narendra Modi government took office, and 7.5 per cent in the September quarter of the previous fiscal, showed government data released here today.
In the fourth quarter of 2013-14, the economy had grown at 4.6 percent.
Coming close on the heels of Moody's recent upgrade of India's sovereign credit for the first time in nearly 14 years, the growth buoyancy comes as a shot in the arm for the Modi government, which has been fighting off charges that demonetisation and GST launch disrupted the USD 2.4-trillion economy.
Moody's expects the world's seventh-largest economy to grow by 6.7 percent in 2017-18 and by 7.5 percent in the next.
Chief Statistician T C A Anant hinted that the numbers could be revised upwards as businesses uncertain of the new Goods and Services Tax (GST) regime may have accounted for lesser taxes. After the five quarters of growth decline, "we see a reversal of GDP in the second quarter".
Finance Minister Arun Jaitley tweeted: "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. Gross fixed capital formation has increased from 1.6 percent in Q1 to 4.7 percent in Q2."