India's real GDP growth to average at 7.4 per cent over 2017, 2018: report

New Delhi: India's growth momentum will get stronger with revival in private investment cycle and real GDP growth is expected to average at about 7.4 per cent over 2017 and 2018, says a Deutsche Bank report.

It also termed as 'faulty' the argument that a 7.5-8 per cent real GDP growth in the next few years will still be lower than what was achieved in the boom period of 2006-2008.

It said the global economy post the 2008 global financial crisis (GFC) has adjusted to a new-normal of low-growth low-inflation environment, and India's growth achievement should therefore be judged taking this structural shift into
consideration.

"In the current new normal, an economy which delivers a steady 7.5-8.0 per cent growth in real terms should be comparable to 9-10 per cent growth in the pre-GFC period, in our view," it added.

According to the global financial services major, the country's growth momentum will only get stronger as private investment cycle starts reviving gradually, along with continuation of strong private consumption.

The medium-term outlook for the country looks "exceedingly positive" driven by supportive population dynamics, steadily rising aspirational middle class and a
reforms oriented government, it said.

"We are forecasting India's real GDP growth to average about 7.4 per cent over 2017 and 2018, which will mark about 200 bps improvement from the average outturn over 2012 and 2013, a period when India's macro came under severe pressure," Deutsche Bank said in its research note.

It termed India as one of fastest growing economies in the world. India lost the tag of the fastest growing major economy to China in the March quarter with a GDP growth of 6.1 per cent, which pulled down the 2016-17 expansion to 7.1 per cent.