The government will release gross domestic product (GDP) data for October-December quarter today around 5:30 pm. Reuters’ forecast for the GDP data ranges from 6.4 percent to 7.3 percent. India’s GDP growth rate was recorded at 6.3 percent in the second quarter of the running financial year pulling up the economy after witnessing consecutive falls in the last five quarters. The Indian economy grew 6.3 percent in July-September quarter. Reuters also believes that at 6.9 percent growth rate, India can easily pip China’s 6.8 percent yearly pace for October-December quarter. Here are the key things to note:
1)Lately, it has been observed that manufacturing and services sector have been overcoming teething troubles in form the goods and services tax (GST) implemented in July last year. ICRA says signs of pick up in the economic activity can be seen of late.
2) Strong GDP numbers can help lift the stock markets and boost rupee. The Indian currency has lost nearly 1.6 percent against the dollar in the last few weeks.
3)Facing criticism over the mounting bad loan problem, encouraging GDP numbers can provide a ray of hope to the government.
4) Rise in the GDP number is also expected after better earnings season, and improvement in the IIP and PMI data.
India’s economic growth can reach 7.4 percent in 2018 and 7.8 percent in 2019, respectively the International Monetary Fund (IMF) had said. The international body expects India to overtake China’s growth rate in this year. The Indian economy grew at 9 percent from 2005 to 2008. The Central Statistics Office (CSO) had projected India’s GDP to grow at 6.5 percent in the running financial year based on the 7 to 8 months of data available. In January this year, ahead of the union budget, the Economic Survey had raised the growth estimate to 6.75 percent for the year ending 31 March backed by increased exports, factory output and non-food credit.