Is India really growing faster than China?
Not only are New Delhi’s official figures showing signs of a slowdown – many believe its claims are grossly inflated anyway
India’s bragging rights for growing faster than China, making it the world’s fastest growing major economy, have taken a severe knock as even its already dubious official growth figures are now betraying signs of a slowdown.
The latest numbers published for the April-June quarter show gross domestic product (GDP) is growing at an annualised 7.1 per cent, a sharp drop from 7.9 per cent in the previous quarter. This is the slowest growth rate in five quarters.
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China is projected to end 2016 with a growth rate of 6.7 per cent, impressive for a US$11.4 trillion giant that’s nearly five times bigger than India’s US$2.3 trillion economy.
According to Ritika Manka Mukherjee of Ambit Capital, India would grow no more than 6.8 per cent in 2015-16, well short of the government’s projection of 7.6 per cent, and would be stuck with the same pace for the current fiscal year of 2016-17 to March 2017.
Like China’s, India’s official growth figures themselves are considered by many as grossly inflated, meaning the economy could actually be growing at a far slower pace. Among those who doubt the official numbers is Ruchir Sharma, chief global strategist at Morgan Stanley.
