NEW DELHI:
India’s fastest growth in over two years shows the economy is recovering, said Finance Minister Arun Jaitley, adding the robust expansion would help the government meet its ambitious fiscal deficit target.
India’s economy grew by a forecast-beating 5.7% in the first financial quarter, its best pace since early 2012, according to official data, as the election win of the Bharatiya Janata Party (BJP) in May spurred business confidence.
The right-wing government’s moves to accelerate bureaucratic decision-making and make it easier to do business are already paying dividends, said Jaitley.
“With the long-term impact of all these new initiatives setting in, I’m sure the impact in coming (financial) quarters will be much larger,” he told reporters in New Delhi.
India’s economy posted two years of sub-five per cent growth, staggering under high interest rates to curb stubborn inflation, a weaker global economic backdrop and a fall in foreign investment as corruption scandals embroiled the previous Congress government.
The performance marked India’s longest slowdown in a quarter-century.
But Jaitley forecast growth this financial year to March 2015 would pick up to 5.7-5.9%, despite weak annual monsoon rains that are vital to the farm sector, after the economy grew by 4.7% last year.
Some economists say 6% growth may be achievable this year in light of the quarterly figures after earlier forecasting around 5-to-5.5% expansion.
Economists say India needs at least eight to nine per cent growth to create jobs for its ballooning youth population.
Jaitley also said he was far more confident of reaching a fiscal deficit target for this financial year of 4.1% of gross domestic product from 4.5% the previous year.
The deficit target inherited from the Congress government had been called a poison chalice by some economists with weak tax revenues and high government subsidy spending make the goal tough to achieve.
But stronger growth makes it easier for the government to realise its promise of slimming the budget deficit – the gap between spending and revenues – to a seven-year low.
Published in The Express Tribune, August 31st, 2014.
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COMMENTS (12)
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@ModiFied:
How do you know so much Modified? You sound very knowledgeable without any basis. Problem with Indians - they think they are so smart. Why is 40% of the country in poverty if you are so smart?
prime minister also aims to scrap old and aged laws which have no real application but only prove hurdles in decision making. such bold moves will decision making smooth and more faster.
@sharabi: pakistan has the habit of giving out false data and fooling their masses ... remember the 5% growth which was contradicted by the IMF ..... at least they should speak truth sometimes..... sometimes at least
@riya Congress for sure but why on pakistan`s face? Be logical and do not try to be a new Bhaktiyar gazhi khan or new sayyad jalal kashmiri(who does not have a single logic in their comments)
another slap on congress and pakistan's face....
I pledge to create 10 jobs by mid 2015.
The excitement is palpable around the country, be it big cities in towns or villages. This hope is not a result of any dreamselling, it stems from the belief in Modi's personal incorruptibility. I don't know if he'll succeed or fail, but he will not go down without giving it his best. Sometimes that is all that is required to wake a nation up...
The excitement is palpable around the country, be it big cities in towns or villages. This hope is not a result of any dreamselling, it stems from the belief in Modi's personal incorruptibility. I don't know if he'll succeed or fail, but he will not go down without giving it his best. Sometimes that is all that is required to wake a nation up.
The govt. will need atleast 2 years to clean up the mess left by Congress. That guy MMS should be tried for his inaction.
I am eagerly looking how govenment resolves nuclear liablity issue? labour reforms bill, reform of land aquisation bill and insurance and defence FDI cap raising bill .Coal issue mining reforms and mr. pm you have a huge task . we are with you . but you do not have majority in rajya saba. congress will obstruct your bills. I will pray for your success. long live PM modi.
Hey..please tell modi to help..pkistan also...6% growth rate of India which is 11* pakistan...and 2% for pakistan..hence India grows approximately 40 times as pakistan...lol...
India's growth rate is bound to overtake China with 2-3 years. New jobs will be created on an unprecedented scale. Expansion of banking sector alone will absorb millions of young boys and girls. Large number of new projects are being started. I see a shortage of man power soon in India. Think of the labor force required for roads, railways and river cleaning projects being undertaken on war footing. Suddenly there is flare up in activities all around.