India's economic growth soared to an over two-year high in April-June quarter, powered by solid expansion in manufacturing, agriculture and consumer spending. Data released by the Central Statistics Office (CSO) showed the economy grew 8.2 per cent in April-June, the first quarter of the country's fiscal year that starts in April, higher than previous quarter's 7.7 per cent and 5.6 per cent in the first quarter of 2017-18.
The manufacturing sector rose an annual 13.5 per cent compared to a decline of 1.8 per cent in the year ago quarter, while the crucial farm sector rose 5.3 per cent, up from 3 per cent growth in first quarter of 2017-18. Finance Minister Arun Jaitley said, “India's GDP for the first quarter this year growing at 8.2 per 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.”
Chairman of the Economic Advisory Council to Prime Minister (EACPM) attributed this positive trend to continued impetus on structural reforms and effective implementation of ongoing policy initiatives. The robust GDP number has also helped India gallop ahead of China and retain the tag of the fastest growing major economy in the world. The Finance Ministry said despite some headwinds like higher crude oil prices, uncertainties on trade front due to protectionist tendencies in some countries, the Indian economy has performed well.
DK Joshi, chief economist at ratings agency Crisil said, “An encouraging development is the slow but steady rise in private consumption spending growth. From 5.7 per cent in Q4FY18, it rose to 8.6 per cent in Q1FY19- the highest in six quarters. For private investments to pick up, as strong and sustained revival in household spending is critical. Sustaining GDP growth at over eight per cent over the next few years would require significant traction in private investments and relentless implementation of reforms to raise productivity.”
