India's economy grows 7.3% in second quarter

It remains world's fastest-growing major economy, with growth outpacing Asian rival China for more than a year

NEW DELHI: India's economy grew by 7.3 per cent in the second quarter of the financial year, according to official figures published Wednesday that fell slightly short of analysts' expectations.

Gross domestic product expanded 7.3 per cent year-on-year in the three months to the end of September, up slightly from the previous quarter, according to the statistics ministry. Analysts said the figures, which were buoyed by good monsoon rains, fell slightly short of expectations of around 8 per cent for the quarter.

India remains the world's fastest-growing major economy, with growth outpacing Asian rival China for more than a year. But economists have warned growth will be hit by the government's shock move to pull 86 per cent of the country's currency from circulation to tackle tax evasion.



"The numbers for Q2 at 7.3 per cent are marginally better than the previous quarter," said Subramaniam Sharma, analyst with the Greenback forex advisory service in Mumbai. "But the effects of demonetisation will be witnessed in the next two quarters, especially between January and March."

India's rosy GDP figures have drawn questions since the government in January 2015 revised its base year to 2011-12 and introduced new methods of calculating expansion which it said were closer to international standards.