NEW DELHI: India is expected to achieve the projected growth rate of 7.4 per cent for the current financial year and further up 7.6 per cent for 2018-19 on strong consumption demand, with South Asia leading the growth chart in Asia and the Pacific, an ADB supplement report said on Thursday.
“Consumption is likely to continue to be the main driver of growth. Higher crop sowing, helped by a healthy monsoon, and an uptick in rural wage growth will bolster rural consumption, while urban consumption will get a boost from pay hikes for central and state government employees,” the report highlighted about India.
According to the report, South Asia will be the fastest growing of all sub — regions in Asia and the Pacific, with growth on track to meet original projections of seven per cent in 2017 and 7.2 per cent in 2018. The growth prospects in developing Asia for 2017 have improved on the back of stronger than expected export demand in the first quarter of this year. ADB has upgraded its growth outlook in the Asian region to 5.9 per cent in 2017 from 5.7 per cent and to 5.8 per cent for 2018.
“Developing Asia is off to a good start this year with improved exports pushing growth prospects for the rest of 2017,” said Yasuyuki Sawada, chief economist, ADB. Implementation of the GST is expected to improve ease of doing business and facilitate growth in the medium term, it said, adding that there could be some teething pains as firms will take time to adjust to the new tax regime.