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DBS: India's Economy Likely to Grow by 6.6% in FY18

DBS: India's Economy Likely to Grow by 6.6% in FY18

India's economy is likely to grow by 6.6 per cent in current fiscal year and a gradual recovery is underway as there are encouraging signs that the country's economic growth has bottomed out, Singapore's banking group

DBS said in its economic report today. The bank said that it is optimistic that the Indian economy will achieve a growth rate of over 7 per cent in fiscal year 2019.

"This growth will be on stabilisation in post-Goods and Services Tax activity helped by more fine-tuning measures, trickle-down benefits from the bank-recapitalisation efforts, a higher fiscal deficit target and stronger investment growth," the report said.

But for FY18, DBS cited the government's advance projection of 6.5 per cent growth. But the bank sees an improvement in investments at 4.5 per cent in FY18 from 2.4 per cent in FY17.

The net trade balance is expected to remain adverse with imports at 10 per cent Year-on-Year (YoY) likely to outpace a 4.5 per cent increase in exports, according to DBS.