GDP turns around, leaps to 6.3% in Sep quarter

India GDP economic growth projection forecast 2016 2017

Representative image Reuters file

Echoing Prabhu's sentiment, Information Technology Minister Ravi Shankar Prasad said: "India's GDP growth rate shows upward trend in 2nd quarter of 2017-18 and registers a growth rate of 6.3 per cent".

Commenting on the demonetisation drive a year ago and its impact on India's growth, Anant said the move will be very hard to read from GDP numbers.

According to the finance minister, India managed 7% to 8% growth at a time the world was moving slowly.

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

Speaking to ANI, Chouhan said "GDP growth rate is increasing and it is a proof of the fact that economic activities are increasing in the country".

Addressing a press conference in New Delhi, Chief Statistician of India, Dr TCA Anant, said the recovery of GDP growth to 6.3% in Q2 from a 3-year low of 5.7% in Q1, after nearly 5 quarters of decline, "marks a reversal which is very encouraging". It expects the economy to grow at 6.7 per cent this fiscal and rise to 7.5 per cent in 2018-19.

With the sign of growth trajectory, Finance Minister Arun Jaitley remained optimistic of a higher growth rate in coming quarters.

"GDP growth recovers to 6.3% in Q2 from a 3-year low of 5.7% in Q1".

"Manufacturing growth has been one of the main reasons for the encouraging growth rate figure of 6.3 per cent for 2nd Quarter", he added.

In the services sector while trade, transport did well, the government finances grew rather slowly because of a muted deposit and loan growth in the banks.

Earlier today, the stock market saw a sharp slump at it has shed over 450 points. Big companies have also largely adjusted to the changes while benefiting from reduced logistics costs. "It's possible that anticipating the need for the festive season, most of the production went into the sale and inventory restocking may happen later...inventory accumulation effect may persist in the third quarter as well", he explained.

Striking a note of caution, the Congress also said the rebound in economic growth is nothing but what it called the Modi governments "desperate spin to hide its luminous underperformance".

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