India’s economic growth to reach 7.5 per cent in 2016

India’s Finance Minister yesterday tabled the country’s Economic Survey for 2015-16. The latter expects GDP growth to be about 8-10 per cent, one of the highest in the world and greater than China’s, driven by the service sector.

New Delhi (AsiaNews/Agencies) – India's economic growth for the coming fiscal year will be around 7-7.5 per cent, this according to the Economic Survey for 2015-16 tabled in parliament by Finance Minister Arun Jaitley yesterday.

For the current fiscal year, the survey estimated GDP growth at 7.6 per cent. The key sector will be services, which is expected to grow by 9.2 per cent in 2015-16.

According to the Survey, “India’s long run potential GDP growth is substantial, about 8-10 per cent.” If this were confirmed, India also would outpace the other Asian giant – China – which has been in a persistent financial crisis in recent years.

This comes just days ahead of the presentation of the Union Budget by the Finance minister, which will lay out the economic agenda of the current administration.

The Survey noted that “India stands as a haven of stability amidst gloomy international economic landscape”.

Its economic growth is amongst the highest in the world, helped by a reorientation of government spending toward needed public infrastructure.

However, the Survey cautioned that if the world economy remained weak, India’s growth would face considerable headwinds.

On the domestic side, two factors can boost consumption: increased spending from higher wages and allowances of government workers.

However, there are three downside risks: turmoil in the global economy might worsen the outlook of exports, oil prices might rise and dampen consumption, and worse still, the two factors might combine.