GDP growth a temporary pause, says Congress

Jaitley further said that impact of demonetisation of high value currency notes of Rs 500 and Rs 1000 in November past year was limited to one or two quarters. The reasons for the foreseen growth recovery are many: a rise in industrial production and exports, restocking by businesses after the transition to GST and some major festivals that would have boosted consumer demand.

The reforms by the central government were leading to a faster growth as well as creating a strong and stable economy, with increased opportunities for the poor and middle class, he added. In the previous quarter January-March, the growth rate had come down to 6.1 per cent.

Former Finance Minister P Chidambaram on Thursday said he was happy that the economy has registered a growth of 6.3 per cent in the latest quarter but still one can not say whether this will mark an upward trend in the growth rate. "Therefore, the current figures mark the reversal - enabled by manufacturing and positive investment - in the growth trend", he said.

The former Finance Minister said, 6.3 percent rate is far below the promise of the Narendra Modi government.

Congress head of communications department Randeep Surjewala said, "Improvement of GDP numbers is an encouraging sign, but it is just a temporary pause from the downward trend".

TMC chief and West Bengal Chief Minister Mamata Banerjee was, however, more vocal in her criticism and claimed that a growth of 6.3 per cent was "no growth".

Growth had slid to a three-year low of 5.7 percent for the three months to June on the spillover effects of the note ban and the GST implementation. "Only talking. No performance", Banerjee said in a tweet, attacking the central government.

Moody's Investors Services recently upgraded India's sovereign rating for the first time in almost 14 years, saying the country was poised for fast growth because of wide-ranging economic and institutional reforms by Prime Minister Narendra Modi's government.

While investment grew by 4.6 per cent in Q2 compared to 1.6 per cent in the first quarter on a year-on-year basis, its share in GDP fell to 27.5 per cent from 29.9 per cent in Q1, indicating that GST-related stress in the economy had not dissipated.

Gross domestic product in Asia's third-largest economy expanded 6.3% in July to September from a year earlier, the statistics ministry said in a statement in New Delhi on Thursday.

  • David Armstrong