At 7.9% In Q4, India Is Still ‘Fastest Growing’ Economy

New Delhi:  India’s gross domestic product (GDP) grew 7.6 percent in 2015-16, powered by a rebound in farm output, and an improvement in electricity generation and mining production in the fourth quarter of the fiscal. Economic growth was estimated at 7.2 percent in 2014-15.

                           

The growth numbers for the last fiscal, which reinforces India’s position as the world’s fastest-growing large economy, came on the back of a strong 7.9 percent growth in the last quarter of the fiscal.

The robust headline number, despite faltering private investment, weak capital goods growth and shrinking exports, has reinforced expectations that the RBI would keep its policy rate on hold at its next quarterly review next Tuesday. The central bank has already cut its policy repo rate by 150 basis points since January 2015, reducing it to 6.5 percent — the lowest level in more than five years.

The strong 7.9 percent growth in the fourth quarter comes at a time when China has reported a 6.7 percent in the March quarter — its slowest growth in about seven years.

According to data released by the Central Statistics Office (CSO), the farm sector grew by 2.3 percent from a year ago compared with a 1.0 percent contraction in the December quarter. Mining grew 8.6 percent in the March quarter, up from 7.1 percent in the previous quarter. Electricity, water and gas production growth surged to 9.3 percent from 5.6 percent in the December quarter.

The CSO, in a statement, said that it has revised the GDP data for the first three quarters released earlier from 7.6 percent, 7.7 percent and 7.3 percent to 7.5 percent, 7.6 percent and 7.2 percent, respectively.