India’s economic growth picked up in the July-September period on rising manufacturing activity and higher investments. It is also the third quarter in a row that India’s economy has outpaced that of China.
Gross domestic product (GDP) in the three months to the end of September rose to 7.4 from 7 percent in the previous quarter, according to statistics ministry data, which was slightly ahead of analysts’ expectations.
India has now recorded three straight quarters of growth above 7 percent, performing better than its giant neighbor China in each of those periods. China reported annual growth of 6.9 percent for the three months ending September 30.
India’s manufacturing sector, which accounts for about 18 percent of the economy, grew 9.3 percent in the second quarter year-on-year, compared with 7.2 percent in the previous quarter.
Investments grew by 6.8 percent from a year earlier, compared with 4.9 percent in the period from April-June.
While BRICS partner Russia saw its economy contracting by 4.1 percent in the same period and Brazil predicted to shrink by 4.2 percent, India is the bright spot in a lackluster global economy.
Indian Prime Minister Narendra Modi has made boosting economic growth a priority. But investors are concerned about the pace of promised economic reform needed to create jobs for India’s tens of millions of young people.
They are hoping Modi’s government will be able to reach agreement with opposition parties and push reforms through the current session of parliament, including a bill for a national sales tax.
Other weak areas in the Indian economy are low private consumption as well as a fledgling agricultural sector.
ng/jlw (Reuters, AFP)
