OECD cuts India’s FY18 growth outlook

download.jpgSource: The Economic Times, Sept 22, 2017

NEW DELHI: The Organisation for Economic Co-operation and Development has trimmed India’s growth forecast for the current financial year, citing the temporary impact of the rollout of the goods and services tax and demonetisation, expecting the economy to expand at a slower pace than China.

OECD said India’s economy will likely grow 6.7% in FY18, lower than its estimate of 7.3% in June.

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Current account deficit seen at 1.2-1.3 per cent of GDP in FY18: Icra

download (1)Source : Economic Times, Sept 17, 2017

India’s current account deficit (CAD), which widened to a four-year high in April-June, is likely to touch USD 30-32 billion, or 1.2-1.3 per cent of GDP by March-end 2018, says a report.

CAD increased to USD 14.3 billion, or 2.4 per cent of gross domestic product (GDP), in the first quarter of the current fiscal from USD 0.4 billion in the year ago period. In FY17, CAD was at USD 15.2 billion, or 0.7 per cent of GDP.

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GDP growth likely at 7.1% in FY 18: Nomura

Source: The Hindu Business Line, Sept 13, 2017

New Delhi: India’s GDP growth is expected to be around 7.1 per cent this fiscal following a likely pick-up in industrial production as firms resort to ‘restocking’ post GST, especially ahead of the festive season, says a Nomura report.

According to the Japanese financial services major, post GST restocking is likely to drive a faster pace of industrial output growth in the coming quarters.Before the implementation of Goods and Services Tax (GST), destocking was triggered largely owing to a steep fall in demand from consumers as they delayed purchases. Post GST implementation, restocking might pick up in anticipation of rising demand conditions.

Nomura further said the ongoing remonetisation will have a positive impact on the cash-intensive services sectors and this, in turn, will help to augur growth numbers.

“On the growth front, we expect industrial production to gradually pick up as firms focus on restocking after GST and especially ahead of the festive season; hence, we think the recovery will likely continue to be led by consumption,” Nomura said.

“Overall, we expect GDP growth of 7.1 per cent year-on-year and GVA growth of 6.7 per cent in 2017-18 (year ending March 2018),” it said.

According to Central Statistics Office (CSO) data, the index of industrial production (IIP) during July slipped to 1.2 per cent on account of a poor manufacturing show, while retail inflation rose to a 5-month high of 3.36 per cent in August due to costlier vegetables and fruits.

Commenting on the data, the report said, “Overall, the industrial production data suggest that the industrial growth recovery is still uneven with weak investment demand, but also currently depressed due to GST effects”.

Regarding inflation data, it said that while demand-side price pressures remain contained, supply side and statistical factors such as food prices, GST and HRA are driving inflation higher.

GDP growth down to 3-year low of 5.7% in April-June quarter of FY18

Source: Business Standard, Aug 30, 2017

New Delhi: The country’s gross domestic product (GDP) growth slowed to a three-year low of 5.7 per cent in the April-June period of 2017-18 from 7.9 per cent in the same quarter a year earlier, showed data released on Thursday by the Central Statistics Office.

The growth numbers for the latest quarter are even lower than the 6.1 per cent seen in the January-March quarter of last financial year, which was considered the period most affected by the immediate issues faced by the economy in the aftermath of the government’s November 2016 decision to demonetise Rs 500 and Rs 1,000 currency notes.Analysts polled by Reuters earlier had forecast a 6.6 per cent GDP growth rate on a year-on-year basis. A key reason for the decline in growth rate is seen as a de-stocking in June on account of uncertainty over goods and services tax (GST), which was to be rolled out from July 1.

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Economic survey gets realistic on growth

Source: Business Standard, Aug 11, 2017

New Delhi: After more data were out on the health of the economy, the economic advisers in the finance ministry now realised that clocking 7.5 per cent growth may be a difficult task for the current financial year.

Not that, they were very sure of this target when volume I of the Economic Survey was released in January this year. What they had projected was a wide range of 6.75-7.5 per cent. So, they had forecast both lower than 7.1 per cent growth, achieved in 2016-17, as well as higher than that, not sure of how twin balance sheet problem will pan out.

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India set to achieve 7.4% growth in 2017: ADB report

download (2).jpgSource: The Hindu Business Line, July 20, 2017

New Delhi: India, which is the largest economy in South Asia, is expected to achieve projected growth rate of 7.4 per cent in 2017 and 7.8 per cent in 2018, primarily from strong consumption, a new Asian Development Bank (ADB) report has said.

In a supplement to the Asian Development Outlook 2017 report, ADB also upgraded its growth outlook for Developing Asia from 5.7 per cent to 5.9 per cent in 2017 and from 5.7 per cent to 5.8 per cent for 2018. The smaller uptick in the 2018 rate reflects a cautious view on the sustainability of the export push. The report said economic prospects in Developing Asia for 2017 improved on the back of stronger-than-expected export demand in the first quarter of this year.

India to grow at 7.2% in FY17, up from 6.8% in 2016: World Bank

indexSource: Business Standard, July 18, 2017

New Delhi: Indian economy is expected to grow at 7.2 per cent this financial year, up from 6.8 per cent in 2016, says a World Bank report. According to the report, though the anxiety about the festering twin-balance sheet problem persists, the economy may grow at an even higher 7.5 per cent the year after.

The World Bank has, however, revised its forecasts for growth downwards from what was projected in its January update.

On the other hand, China’s economic growth is projected to slow at 6.5 per cent in 2017, down from 6.7 per cent the year before. But given the strong second quarter growth, China’s GDP grew at 6.9 per cent belying expectations, overall growth for the year may well end up being higher.

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