Can India's Economy Recover?
MUMBAI, India — India’s economy is showing signs of a gradual recovery as gross domestic product increased at an annual rate of 4.8 percent in the three months that ended in September.
The growth surpassed the expectations of analysts, who projected a 4.6 percent rate, and was faster than the 4.4 percent pace seen in the previous quarter, which was the slowest growth in four years.
“The Indian economy has bottomed out on growth, and I think we are definitely seeing signs of a mild, moderate recovery — not just the gross domestic product numbers but in the results of individual companies,” said Saugata Bhattacharya, chief economist at Axis Bank. “However, in order to resuscitate growth, the government must improve investment channels, take measures towards fiscal consolidation, decontrol diesel prices and simplify the tax structure.”
The pickup in the September quarter was driven primarily by a good monsoon, which helped the agriculture sector expand at a 4.6 percent annual rate, according to the government figures released Friday. The sector that includes finance, insurance, real estate and business services also performed well, increasing by 10 percent; the sector for electricity, gas and water, increased 7.7 percent; and construction, 4.3 percent.