Gold Silver Reports – India’s Economy Continues To Rebound :Q3 GDP Data — India’s economy picked up pace in the October-December period as it continues to recover from the twin disruptions of demonetisation and a nationwide goods and services tax.
Q3 GDP Data
The gross value added growth stood at 6.7 percent in the third quarter of 2017-18 compared with a revised 6.9 percent in the same period last year and a revised 6.2 percent in the previous quarter, according to data released by the Central Statistics Office today. A Bloomberg poll of economists had pegged GVA growth at 6.7 percent.
GVA has become a preferred measure of economic growth as it strips out the impact of indirect taxes and subsidies. The more commonly tracked gross domestic product growth stood at 7.2 percent compared with a revised 6.5 percent in the second quarter.
“The shadows of demonetisation and GST may be behind us,” said Madan Sabnavis, chief economist at CARE Ratings said. While the disruptions may be over, it may be too soon to say the economy is accelerating, he said.
The Indian economy was hit by twin shocks of a cash purge and GST over the past 18 months, disrupting economic activity which has only now started to rebound. A modest revival in the investment cycle along with a pick-up in exports is expected to support this “nascent” recovery, the RBI had said.
India is now expected to grow faster than estimated in 2017-18. GVA growth for the full year is seen at 6.4 percent compared to 6.1 percent forecast in the first advance estimates. GDP too is expected to grow 6.6 percent in the year ending March 2018—10 basis points higher than January estimates. That may provide some reprieve to Prime Minister Narendra Modi ahead of the Lok Sabha election in 2019.
Yet, the expected GVA growth is still lower than the 6.7 percent India recorded in the previous year and the GDP estimate is 50 basis-points lower than last year. “Something substantial will need to be done next year if the government wants to cross the 7 percent mark,” said Sabnavis. – Goldman Neal Bhai Reports
