Indian economy is expected to grow by 7.9 per cent growth in the current fiscal according to Goldman Sachs report.
The country’s real GDP growth accelerated to 7.9 per cent year-on-year in the first quarter of this year and recorded a five-year high growth rate of 7.6 per cent for the 2015-16 fiscal on robust manufacturing growth.
According to report, key risks to India’s growth trajectory include a faster pace of US Fed rate hikes than is currently priced in, concerns about Chinese growth and capital flows.
Domestically, it cited aggravation of bad loans problem of state-owned banks or fiscal revenue slippage as potential risks. Moreover, corporate leverage may constrain activity in heavily levered sectors.
Report lauded the several important policy changes and reforms that have taken place over the past couple of months in the country like passage of the GST bill, government approval of the inflation targeting framework, the bankruptcy code, measures to ease doing business, a pick-up in infrastructure investment, and easing in FDI restrictions in the defense, aviation, retail and e-commerce sectors, among others.
A positive monsoon development for the first time in three years is also supportive of growth numbers.