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03 December 2017, 01:12 | Lionel James
Has the tide turned?
Chandrajit Banerjee, director general, CII, said, "The rebound in GDP growth to 6.3%, after the uninspiring performance of the previous quarter is noteworthy and a great confidence booster".
Ratings agency CRISIL's research arm pointed out that the rise in GDP growth signalled the fading impact of demonetisation and destocking that preluded the implementation of GST.
Gross domestic product grew 6.3 percent in July-September, its fastest pace in three quarters, the data showed.
Agricultural growth fell to 1.7 per cent in Q2 from 2.3 per cent in the previous quarter because of a sharp decline in the production of foodgrains during the kharif season.
The government accounts data, released earlier in the day, showed that the Centre's fiscal deficit touched 96 per cent of the budget estimate in the first seven months of the year. However, it is expected that the rebounding GDP could blunt Opposition's attack on Prime Minister Narendra Modi for his "hasty GST launch".
The growth in the agriculture slowed to 1.7% compared to 2.3% in the last quarter and 4.1% in the same quarter past year. This marks the reversal of this trend.
Syncing with recent Moody's upgrade of India's sovereign credit for the first time in almost 14 years, the growth buoyancy comes at a time when the Modi Government has been facing Opposition charges of wrong implementation of demonetisation and GST that disrupted the $2.4-trillion economy. In the fourth quarter of 2013-14, economy had grown at 4.6 per cent. The finance minister said a cogent GST mechanism has been developed and no country in the world has 5 per cent tax rate. Mr Anant said, the manufacturing sector in the second quarter of 2017-18 grew by 7 per cent. Fixed capital formation, being up to 4.7%, means the investment is going upward.
"The September quarter GDP growth, he added, is quite a significant trend reversal and has been driven by pick-up in manufacturing".
Modi government hopes the ratings upgrade can attract more foreign investors, who pumped United States dollars 15 billion into Indian equities in July-September, up 44 percent from the previous quarter.
"GST has made doing business and trade very easy".
The Central Statistics Office's (CSO) data disclosed that GDP for Q2 stood at Rs 31.66 lakh crore, or a growth of 6.3 per cent. Since May 2014, out of the 13 quarters, we have clocked upwards 7 per cent eight times, and we fell below 6 per cent only once in the last quarter. "The growth in the "agriculture, forestry and fishing", "mining and quarrying", "construction" "financial, insurance, real estate and professional services" and 'Public administration, defence & other services" is estimated to be 1.7 percent, 5.5 percent, 2.6 per cent, 5.7 percent and 6.0 percent respectively, during this period", a press release by the government said.
Rush hour natural disaster shakes region
Significant damage does not typically occur with quakes of this size, and so far there are no reports of any injuries. The station also writes that Paul Caruso, a geophysicist with the USGS, says there is potential for aftershocks.