India’s economy grows to record 7.4%

INVESegAccording to official figures India’s economy grew at a rate of 7.4% between July and September, up from 7% in the previous quarter.

Higher domestic demand and manufacturing activity accelerated the pace, taking the rate higher than China’s. The Central Bank is now to meet and set the level of interest rates that it cut last month by half a percentage point, to 6.5%.

India’s economy gained from a dip in commodity prices, however the way statistics are compiled has recently changed, making comparisons difficult.

The figures show that India continues to be the fastest growing major economy in the world, but it needs to grow even faster if it is to create jobs for its large population. This week will be an important test for the government as it hopes to push a key tax bill through Parliament, that will cut the multiple layers of taxation business owners face and introduce one single tax across the country.

If passed it will be the first major reform by PM Narendra Modi’s government since it took over in 2014.