The last day of the month brought two good news on the economic front. First, Indian economy gained momentum in the last quarter of FY 2015-16 at it expanded by 7.9% during January-March this year in comparison with 7.5% growth recorded during the same period last fiscal. This helped India to clock the fastest GDP growth rate of 7.6% in the last five years. Second, another data released Tuesday showed that 8 core infrastructure sectors registered the fastest growth rate of 8.5% in the last four years.
GDP growth rate of 7.6% has consolidated India’s position as fastest growing major economy as its giant neighbour China faltered last year to slip below 7%.
The high growth is attributed to good performance of manufacturing and farm sectors in the last quarter.
Encouraged by the impressive numbers for 2015-16, as against 7.2 per cent in previous fiscal, the government said the growth rate can go up to 8 per cent in the current fiscal on the back of good monsoon.
Economic Affairs Secretary Shaktikanta Das said India can move towards 8 per cent growth with better agriculture production.
“The various measures that the government has been taking in the last couple of years is beginning to show results and overall there are greenshoots…this year hopefully with good monsoon we should look at a growth closer to 8 per cent,” he said.
Finance Secretary Ashok Lavasa, who took charge on Tuesday, said, “We should work towards seeing this (GDP growth) number grow. We are focusing on capital spending in infra and social spending.”
NITI Aayog Vice Chairman Arvind Panagariya tweeted: “Growth rate in the 4th quarter of 2015-16 at 7.9% almost hits the magical 8% mark. Good days ahead.” .
Industry also praised the GDP numbers and expressed hope that better monsoon and further reforms will help expand the economy at even a faster pace.
The core sector data in April too indicated momentum in the economic activity as it grew at rate of 8.5 per cent in the month, the highest in the last four years.