India’s economy could expand by 8 percent or more in fiscal 2016, should just “one of three factors improve”, Indian Finance Minister Arun Jaitley told The Nikkei Asian Review — predicting the fastest expansion in six years.
The Finance Minister cited slowing global growth, depressed private-sector investment, and a lack of rain showers as obstacles facing India. However, he said that private investment is rebounding into a recovery.
India’s fiscal year runs from April to March.
As for fiscal 2015, Jaitley said the India’s economy is moving in line with the World Bank’s forecast of 7.5 percent growth, which would mark an improvement from last fiscal year’s pace of 7.3 percent.
India’s potential growth rate is “certainly in the 8 to 9 percent” range, Jaitley added.
Despite China’s economic slowdown, there has been only a “marginal” effect on India, as its economy is not linked to Chinese production or distribution chains, Jaitley said.
In regards to a likely interest rate hike by the U.S. Federal Reserve, Jaitley says he sees a possible “transient impact,” however he says that India has a “significant amount of resilience” to enable it to normalize.