India has become the world’s fastest growing economy with over the world.
The Government of India’s report (28-2) says GDP growth in the third quarter of fiscal 2017 (October 3, 11 and 12-2017) 7.2% (6.5% higher than the same period last year) and higher than China’s 6.8% over the same period.
India’s fiscal year runs from April of this year to March of next year.
Motivation from consumption and export
India’s third-quarter GDP growth in the fiscal year of 2017 has clearly “beat” many of the analysts’ earlier predictions.
A Reuters survey of 35 economists estimated that the rate was only about 6.9 percent.
It is a sign of India’s strong economic recovery after a dismal first half of 2017.
In the first six months of last year, India’s growth rate fell from 7% to 5.7%, the lowest level in three years, after two major policy changes by Prime Minister Narendra Modi that banned the circulation of two the largest denomination of dollars and the complete reform of the tax system, turning 29 states into a single market.
Market observers identified the key drivers for growth in India’s latest quarter, boosting consumption and exports.
Inflation has little impact on household expenditures, while growth in the agricultural sector slows.
Economists at Singapore’s DBS Bank also said that India’s economic growth rate reversed positively in the second half of 2017 mainly due to the surge in industrial production, The factory recovered from the initial deviation when the reform tax law was introduced in July-July.
Can grow by 10%
It is expected that India will continue to widen its gap with China in 2018. Last month, the International Monetary Fund estimated that their GDP would increase by 7.4% this year.
For his part, Modi’s government even set higher expectations.
“The government has really pushed for a great deal of structural reform, and within a year or so the reforms will start to work,” said Amitabh Kant, one of the senior policy advisers. of the Government of India, shared this very confident view in an interview earlier this week on CNN.
According to Amitabh Kant, a growth rate of 10% or higher is “very feasible”.
However, international observers are not as optimistic. In recent months, India’s economic conditions have somewhat softened due to rising oil prices. Crude oil is one of India’s largest imports.
Analysts at Japan’s retail bank Mizuho said that in the context of higher oil prices this year, India’s trade deficit widened, inflationary pressures and dispersal from the land administration, may be causing India’s strong growth momentum to face backward trends.
According to the group, India’s annual growth rate is estimated at 7-8%.
China aims to “Develop high Quality”
According to Xinhua News Agency (China), in its inaugural meeting in early March, congressional deputies and Chinese political advisers will consider and discuss specific measures to Promote the economy of the country towards a more stable and environmentally friendly.
The document presented at the 19th Communist Party Congress last October also stressed “China’s economy has been transforming from a fast-growing to a high-quality development stage.”
Economists estimate China will maintain its economic growth rate at 6.5 percent this year, but some local governments have also slashed expectations In the meeting.