(LiveMint)
India’s economy accelerated to a nine-quarter high at 8.2% in the first quarter of 2018-19, beating expectations on the back of a strong pickup in manufacturing and a low base in the year-ago period. This is likely to provide a much-needed breather to the government that is under fire over the depreciating rupee and demonetization.
“India’s GDP for the first quarter this year growing at 8.2% in otherwise an environment of global turmoil represents the potential of New India. Reforms and fiscal prudence are serving us well. India is witnessing an expansion of the neo middle class,” tweeted finance minister Arun Jaitley. Economic growth had dipped to 5.6% in the April to June 2017 quarter as companies reduced stocks ahead of the rollout of the goods and services tax (GST) in July last year.
Manufacturing grew in double digits at 13.5% in the June quarter from a contraction of 1.8% in the same quarter a year ago, while construction made strong recovery to grow at 8.7% against 1.8% during same period last year, which is good for the job market, according to data released by the Central Statistics Office (CSO) on Friday. Agriculture also grew at a robust 5.3% in the June quarter against 3% during the same quarter a year ago.
While private consumption picked up (8.6%) in the June quarter, implying a recovery in consumer demand that drives the economy, a robust double-digit growth (10%) in investment demand indicated factories may be expanding their capacity to meet the additional demand.
