Provisional estimates of the macroeconomic situation in India for the first quarter of 2019 will be released today. The Indian
Provisional estimates of the macroeconomic situation in India for the first quarter of 2019 will be released today.
The Indian economy has performed tepidly in the last 18 months. Indeed, economic growth is expected to have slowed to between 6% and 6.3% in the January to March quarter of the 2019 financial year, per a survey of independent economists. This would be a significant drop from the 6.6% growth reported in the preceding quarter.
Various challenges including a slowdown in private consumption have persisted despite low inflation rates, while foreign direct investment inflows fell by 1% to $44.4 billion in the 2017-18 fiscal year. Declining investments in the telecommunications and pharmaceuticals sectors are primarily responsible for this drop.
Meanwhile, India has struggled to compete with China’s export potential. China’s 2018 exports to the US alone were valued at $560 billion, nearly double the value of India’s total exports in the same period.
A slowing economy in the first quarter of 2019 indicates that India will likely need to attract investments away from China, lest Beijing outpace New Delhi’s economic growth. As India seeks to match China as a regional power going forward, economic growth will be an important indicator of geopolitical strength.
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