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GDP growth a temporary pause, says Congress

03 December, 2017, 01:11 | Author: Paula Vaughn
  • Government figures showed Asia's third-largest economy expanded for the first time in five quarters

According to Assocham's Secretary General D.S. Rawat, the 6.3 per cent growth in the GDP for the second quarter has come "as a big relief to India Inc, in the backdrop of quite subdued performance of the previous quarter". The country's fiscal deficit crossed 96 per cent of Budget estimates at October-end. Jaitley said the Goods and Services Tax (GST) started with different tax rates and they have rationalised rates on many items.

"It is well accepted that investment in infrastructure is essential to growth, it increases the productivity of existing resources and crowds in private investment, which in turn creates more jobs and leads to economic well-being", he said.

Moody's Investors Services recently upgraded India's sovereign rating for the first time in almost 14 years, saying the country was poised for fast growth because of wide-ranging economic and institutional reforms by Prime Minister Narendra Modi's government. On the other hand, Moody's predicts that India would be the world's seventh-largest economy to grow at 6.7 per cent in 2017-18 and at 7.5 per cent in the next fiscal. "After nearly 5 quarters of decline, GDP marks a reversal which is very encouraging", Chief Statistician of India TCA Anant said in a press conference in New Delhi. Mr Anant said, the manufacturing sector in the second quarter of 2017-18 grew by 7 per cent.

"The September quarter GDP growth, he added, is quite a significant trend reversal and has been driven by pick-up in manufacturing". Since May 2014, out of the 13 quarters, we have clocked upwards 7 per cent eight times, and we fell below 6 per cent only once in the last quarter.

Former finance minister P Chidambaram, however, said 6.3% growth was "far below the promise of Modi government and potential of the well managed Indian economy".

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Reversing a five-quarter slide in Gross Domestic Product (GDP) growth, the economy bounced back from a three-year low to expand by 6.3% in July-September as manufacturing revved up and businesses adjusted to the new GST tax regime.

The agriculture, forestry and fishing sector is estimated to have grown by 1.7 per cent.

"Traditionally, July-September is a quarter where a lot of production takes place to cater to festive demand".

Mining also posted a sharp uptick in growth to 5.5 per cent from a decline of 0.7 per cent in the previous quarter.

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