India Ratings predicts 7.8% GDP growth rate

Riding high on the back of good monsoon, Indian economy is all set to record a growth rate of 7.8 per cent this fiscal, India Ratings said in its recent Research Report. As a matter of fact, the upward revision has been prompted by the progress of monsoon and the sowing of kharif crops so far, it said in its Economic Outlook for 2016-17. It had earlier pegged GDP growth at 7.7 per cent this fiscal. Meanwhile, India Ratings also expects a pick-up in consumption demand, which is likely to grow at 8.4 per cent this fiscal, on the basis of favourable monsoon as well as the Seventh Central Pay Commission payout. However, industrial growth at 7.2 per cent in 2016-17 will still be lower than the 7.4 per cent witnessed as against last fiscal. The key factor that is holding the acceleration of industrial growth is investment recovery, it said, noting that though the government has taken several initiatives, such as to encourage manufacturing and solve power sector problems, it has so far failed to produce the desired results.