The GDP growth during the third quarter of the fiscal was at 7 per cent.
The economic growth in January-March period of 2017-18 surged to 7.7 per cent, the highest since a painful demonetisation and chaotic GST rollout.
Interim Finance Minister Piyush Goyal has said that, GDP growth has been increasing continuously every quarter with growth of 7.7 percent in the fourth quarter of 2017-18.
"So manufacturing at 9.1 per cent and construction at 11.5 per cent indicate a turnaround in the economy which going forward would also give a big momentum to growth", he said.
Separately, infrastructure sector recorded a 4.7 per cent growth in April, as against 2.6 per cent a year ago, data released by government showed.
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As compared to India's outstanding performance, China Grew at 6.8% in the January to March Quarter. There has been improvement in growth rate in manufacturing and construction. For the full financial year, however, the growth rate of 6.7 per cent is a four-year low.
Though global rating agency Moody's earlier this week cut its GDP growth forecast for India due to higher oil prices and tighter financial conditions, it still expects the country's GDP to expand by 7.3 per cent this fiscal year.
The data may offer a boost to Prime Minister Narendra Modi, who is set to seek a second term next year.
"Domestic dynamics are very strong and external volatility won't derail the current economic recovery", noted Hugo Erken at Rabobank, one of the most accurate forecasters on India GDP, and whose view is that growth reached 7.7 percent on a normal basis, well above the 7.3 percent median. The moderation in growth was driven by impacts from successive policy shocks of demonetization and the Goods and Services Tax; and the twin balance sheet problem of high corporate leverage and banks' stressed balance sheets.
"Seems like we have moved beyond the teething troubles related to GST implementation", said Tushar Arora, a senior economist at HDFC Bank.
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Forecasts ranged from 6.9 to 7.7 percent. GVA growth for Q4 FY18 also picked up to 7.6%YoY, helped by manufacturing and construction sectors growth.
India's recovery could be threatened by higher global crude oil prices, which this month hit $80 a barrel, their highest since 2014. "We should however be wary of the headwinds the economy faces in the coming quarters from higher crude prices feeding into inflation and rising inflation expectations".
As per the report, India's current account deficit will increase.
Rising oil prices could also weigh on the consumer demand, say economists.
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