Indian Economy Expects Lagging Growth This Year

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India is expecting a modest economic growth of 7.1 percent through March 2017 as opposed to the 7.6 percent expansion level in gross domestic product from the previous year. The level was the lowest in three years, according to the statistics ministry of the country, Friday.

A 1.8 percent slump is expected in the country’s mining output, paring some of the 7.6 percent increase in the previous fiscal year, as data released by the Ministry of Statistics and Programme Implementation reveal.

Also, the growth in the manufacturing sector is anticipated to cut back from 9.3 percent to 7.4 percent. Services such as trade, hotels and transport are also expected to slow down in growth with 6 percent in comparison to last year’s 9 percent rise.

On the contrary, the agricultural sector sees a more optimistic view as farm output is projected to gain 4.1 percent, significantly higher than last year’s 1.2 percent increase.

If projections in GDP growth are met, it would reestablish India’s top spot in the list of the world’s fastest-growing large economies.

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However, economists warned of the possibility that actual growth can fall short of the ministry’s projection since the data gathered where the projections are based were taken before the government’s decision to withdraw 86 percent of its currency in circulation last November 8.

The decision created a major cash deficit which disrupted activity in Asia’s third-largest economy when factory and farm-supply chains’ payments were compromised.

Most economists lowered the Indian GDP growth’s forecasts from around 7.5 percent before the currency slash to between 6.5% and 7% this fiscal year.

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