Indian economy to grow at 7.5% in 2018: Nomura
December 11, 2017  16:08
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Global investment bank Nomura has predicted India's economy to register a 7.5 per cent growth rate in 2018, saying it is on the cusp of a cyclical recovery.


India's Gross Domestic Product growth bottomed-out in the second quarter of 2017 at 5.7 per cent year-on-year, rising to 6.3 per cent in the third quarter, it said. It has forecast 6.7 per cent in the fourth quarter and a full-year growth of 6.2 per cent this year, rising to 7.5 per cent in 2018, it said.

"We remain bullish on India's macroeconomic outlook," Nomura said in its Asian economic outlook 2018. The Indian economy is on the cusp of a cyclical recovery and the government has continued to implement structural reforms and prudent macro policies, the tangible benefits of which may be harder to pinpoint right now, but over time will be positive for growth, it said in the report. Higher crude oil prices and state election results are the main risks, it said. Given the base effects, Nomura expects the growth in the first half of 2018 to be at 7.8 per cent, higher than the 7.1 per cent of the second half of 2017.

"Further out, we expect a growth of 7.3 per cent in 2019 -- a solid print, aided by manufacturing and private services on the supply side and investment and private consumption on the demand side," the report said.


It listed out factors supporting a strong growth. It would be the normalisation of Goods and Services Tax- related supply disruptions; the positive effects of bank recapitalisation, a positive remonetisation impulse and a positive fiscal impulse.  -- PTI
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