SME Times is powered by   
Search News
Just in:   • Huawei's laptop removed from Microsoft store  • China-Myanmar media forum held in Yangon  • US dollar rises amid economic data  • Nike, Adidas urge Trump to end trade war  • Apple nurturing young Indian coders to create Next-Gen apps 
Last updated: 08 Dec, 2015  

India.Growth.9.Thmb.jpg GDP data: Recovery on but concerns remain

   Top Stories
» Reduce interest rate, corporate tax, free up agriculture: Economist
» Finance Commission meets Ministry of Electronics and IT
» India an attractive destination for global investors: Naidu
» High-level committee submits strategies on reducing import
» Investment needed urgently as consumption hit: Experts
Bikky Khosla | 08 Dec, 2015
India has cemented its place as the fastest growing major economy. As per recent official data, the country's GDP grew 7.4 percent in the three months ended September 30, from 7.0 percent in the previous quarter. China, during the same period, grew 6.9 percent. It seems that the continued efforts of the government - since it came to power in May 2014 - to bring the economy back on track have started showing results. It is a pleasure to see that both industry and services sector have contributed to these growth numbers.

The services sector performed fairly good during the period, but the strongest positive sign, I think, is the resurgence in manufacturing growth. The sector grew 9.3 percent compared to 7.9 percent during the corresponding period previous financial year. During the previous quarter the growth rate was 7.2 percent. With this level of growth, it seems, the policy direction of the government, with its flagship 'Make in India' programme, is bearing fruit, and overall, the GDP data fuels perception that the economy is in the midst of a recovery.

However, not all is well with the growth numbers. Most significantly, the sharp fall in the growth rate of the construction sector, despite the Centre's significant push to road building, is a big concern. Similarly, the agriculture sector registered a growth of 2.2 percent, which beats forecast, but is still very low and may lead to poor rural demand for a prolonged period. In addition, the second quarter GDP growth was mainly driven by public expenditure, and recovery in private investment still seems to be some time away. The government's ability to push reforms will hold the key to further growth in the coming days.

Meanwhile, it has been reported that the RBI is likely to release its final guidelines on computation of banks' base rates on the basis of marginal costs of funds - a mechanism for faster transmission of repo rate cut to borrowers. This is a welcome development as banks often do little to pass on the rate cut benefits. This will not only help bring down high costs of credit, which I think is - besides being a big worry to the whole Indian industry including MSMEs - one of the major negative factors for the country's export sector. At the same time, I also see an urgent need of some strong strategic moves by the Centre to prevent exports from falling further.

I invite your opinions.
Print the Page Add to Favorite
Share this on :

Please comment on this story:
Subject :
(Maximum 1500 characters)  Characters left 1500
Your name:

gk | Thu Dec 17 21:04:54 2015
With minority in Rajya Sabha,i feel opposition will derail reforms.

Given growth rate seems artificial
Feroz Wakil | Sun Dec 13 09:58:52 2015
Looking to the ground reality, GDP growth looks false, given to the facts of rupee value, infiltration, resentments into local markets including public opinion, growth is invisible on the ground but legible on the paper. Credibility of this report is to be examined and made public by those who believe it correct.

  Customs Exchange Rates
Currency Import Export
US Dollar
UK Pound
Japanese Yen 58.85 56.85
As on 22 May, 2019
  Daily Poll
Is counterfeiting a major threat to SMEs?
 Can't say
  Commented Stories
» The Silk Road - A journey through history(1)
About Us  |   Advertise with Us  
  Useful Links  |   Terms and Conditions  |   Disclaimer  |   Contact Us  
Follow Us : Facebook Twitter