India’s economy grew at an average rate of 7.5 per cent in 2015, faster than the 6.9 per cent growth in China, official figures show.
India’s government said GDP growth in October to December was 7.3 per cent, a slight drop on previous quarters which were revised sharply higher.
Even though the economy lost steam in the last quarter, its pace of expansion was faster than the growth posted by China in the same quarter.
India measures the economy over a fiscal rather than a calendar year.
Prime Minister Narendra Modi’s government said growth for the fiscal year ending March 2016 is forecast to accelerate to 7.6 per cent.
‘Counterintuitive’
However, some economists say the latest growth figures are at odds with other data for Asia’s third largest economy, including weak exports, railway freight, cement production and investment and flat order books.
Ritika Mankar, an economist at Ambit Capital, said: “The new GDP series and the information it is conveying, not just in terms of level but also in terms of the direction, seems counterintuitive.”
Shubhada Rao, chief economist at Yes Bank in Mumbai, said the figures were “difficult to correlate” with other data, including a contraction in agriculture.
A year ago India’s statistics ministry revised GDP growth rates higher—closer to that of China—by updating the base year used for price comparisons.
Yogita Limaye, a BBC Mumbai Correspondent said: “It’s fair to say there’s been a lot of scepticism about India’s GDP data since the government revised the way it calculates those numbers in January last year.
“All of the economists I’ve spoken to recently have said that they don’t see this rapid pace of growth reflected on the ground.
“But all of them also say that there’s no dispute India’s economy is expanding, making it a rare bright spot among emerging nations.
“Prime Minister Narendra Modi has been travelling the globe and telling companies to come make in India.
“But India is still a difficult place to do business in, and while the government has been working to try to reduce bureaucracy—some laws that could help ease problems are still stuck in parliament.
“Perhaps when that changes we’ll really begin to see the impact of faster growth. (BBC)