India’s economic growth will accelerate to 7.5% in the next year 2018, widening the lead over China, whose economic expansion will slow further to 6.2%, the largest oil producing bloc OPEC said today in its monthly report, adding to a host of other recent predictions about India’s economic growth outpacing that of China.
“India is forecast to expand its growth level to 7.5% in 2018, compared with 7.0% in the current year, supported by ongoing structural reforms,” OPEC said in its Monthly Oil Market Report for July released today. “China will continue to grow at a slightly lower rate of 6.2% in 2018, compared with 6.6% in 2017,” OPEC report said, albeit, adding, “This still represents a considerable level of expansion, as the country continues to shift its growth drivers from exports and investments to domestic consumption.”
Earlier last week Harvard University said in a research study that India will be the base to the economic pole of global growth over the coming decade with a 7.72% growth rate annually, remaining ahead of China, whose economic growth will dramatically fall to 4.41% in the coming years until 2025. “The economic pole of global growth has moved over the past few years from China to neighbouring India, where it is likely to stay over the coming decade,” Havard’s Center for International Development said in a study.
OPEC today said that the world economic growth in 2018 will remain stable at 3.4%, reflecting a continued strengthening of the global recovery which is becoming more balanced, with stability in the oil market remaining a key determinant.
It must be noted that India’s economic growth in the fiscal fourth quarter (Jan-Mar) of the last financial year slowed to 6.1%, dragging the full-year growth down to 7.1%, as the full effect of demonetisation weighed on the economic activity. However, several experts have of late predicted a high economic growth phase in Indian economy after the blip in the fourth quarter.
“India’s GDP growth is set to accelerate in 2H17 (July-December), reflecting a balance in economic activity,” OPEC said, adding that this would be despite the loss of momentum Jan-Mar due to demonetisation of high value currency notes in November 2016. Further, calling the effects of demonetisation as only temporary, OPEC said that private consumption will continue to remain India’s major growth driver.