Expert Views: India's economy grows 6.3 percent in July-Sept

The GDP data for the September quarter came on a day when it was reported that India’s fiscal deficit at the end of October hit 96.1% of the budget estimate for 2017-18

The GDP data for the September quarter came on a day when it was reported that India’s fiscal deficit at the end of October hit 96.1% of the budget estimate for 2017-18

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 country's fiscal deficit crossed 96 per cent of budget estimates at October-end, according to government data. "We also possibly need to examine whether the 3 percentage point increase in tax rate on services - from an effective 15% pre-GST to 18% under GST - is causing some demand side impact".

To scale to 10 per cent rate is "very challenging" and it will not depend on domestic factors only but on how the world is moving, he said.

India's economic growth bounced back from a three-year low, giving the central bank enough ammunition to keep interest rates on hold 6 December amid an uptick in inflationary pressures. In the fourth quarter of 2013-14, economy had grown at 4.6 per cent.

Releasing GDP data in New Delhi today, Chief Statistician of India T C A Anant said the GDP growth has seen a reversal trend from declining trend in the last five quarters.

"Buoyed by the overall improved GDP number, Finance Minister Arun Jaitley said, "perhaps the impact of two structural reforms â€" GST and demonetisation were behind us".

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"The September quarter GDP growth, he added, is quite a significant trend reversal and has been driven by pick-up in manufacturing".

"Indias economic stress continues; GDP far below at 6.3 pc compared to 7.5 pc of Q2 of previous year! - a close scrutiny reveals the real picture of the economic mess created by BJP Government", he said in a statement.

Former Finance Minister P Chidambaram on Thursday said he was happy that the economy has registered a growth of 6.3 per cent in the latest quarter but still one can not say whether this will mark an upward trend in the growth rate.

The Central Statistics Office's (CSO) data disclosed that GDP for Q2 stood at Rs 31.66 lakh crore, or a growth of 6.3 per cent. The growth in agriculture, forestry and fishing was 1.7 per cent, mining and quarrying 5.5 per cent, construction 2.6 per cent, and financial, insurance, real estate and professional services 5.7 per cent.

Modi government hopes the ratings upgrade can attract more foreign investors, who pumped United States dollars 15 billion into Indian equities in July-September, up 44 percent from the previous quarter.

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