India grows at fastest pace in two years
A rebound in the manufacturing sector and recovering farm output drove India’s quarterly growth to 8,6 per cent, according to government data released Monday, the best showing in two years as Asia’s third-largest economy returns to pre-crisis levels of expansion.
Manufacturing surged 16,3 per cent off a low base for the March quarter, up from 0,6 per cent a year earlier. Agriculture grew 0,7 per cent, turning around from the 1,8 per cent contraction in the previous quarter but down from 3.3 per cent in the previous year.
On Monday, finance minister Pranab Mukherjee reiterated his confidence that the economy would grow at 8,5 per cent-plus in 2010-11. Finance secretary Ashok Chawla also pegged economic growth at 8,5 per cent in 2010-11.
– The growth numbers are pleasant but not really surprising, because we were expecting them to be robust which they turned out to be. This clearly indicates the momentum which is in the economy and the expecta-tions that the 8,5 per cent estimation for 2010-11 is going to be a clear possi-bility, he said.
India has rebounded from the global downturn faster than expected thanks to strong domestic consumption and investment, but two uncertainties loom: Rain and Europe.
As India’s farmers wait for the monsoon, hoping last year’s drought will not be repeated, the nation’s business elite watches Europe — which accounts for a fifth of India’s exports — hoping its sovereign debt crisis will not dampen the investment that’s needed to drive growth.
From 2003-2008, economic growth averaged 8,8 per cent a year, before slumping to 6,7 per cent last fiscal year as the Great Recession roiled India’s economy.
India’s Prime Minister, Manmohan Singh, says the billion-plus nation needs to grow at 10 per cent a year to eradicate chronic poverty.
Kilde: www.worldbank.org
