Buoyed by a global economic revival and growth, it is likely that the worst may be over for the Indian economy. This has been predicted by Goldman Sachs. In an economics research paper released by the investment firm, it is projected that the current financial year 2019-20 may see India’s GDP growth figure finishing at 5.3% and will scale up to 6.6% by the next fiscal (FY2020-21). Goldman Sachs expects sequential growth to pick up over the next several quarters.

This report comes after GDP growth slowed down to a 6-year-low of 4.5% for the quarter ended September. The prediction is that the subsequent two quarters of the year, Oct-Dec 2019 and Jan-Mar 2020 should considerably pick up momentum to finish at 5.3% for the full year.

The Goldman Sachs report, however, flags the Indian financial sector as a possible risk factor affecting its predictions. The confidence level in the financial sector is the factor mentioned in the report. It is possible, the cases of DHFL, Yes Bank and IndiaBulls could be rankling the researchers.

The Goldman Sachs Economics Research says the reason for its optimism stems from the sequential pick up expected to be witnessed at the global level. Internally, the report expects that there will be higher consumption, increased investment and acceleration in exports. All these will pull the economy out of the trough it has reached over the previous few quarters.

One index the report refers to is the expansion in disbursement of personal loans though credit to the industry looks muted. There is also mention in the report on the 23% hike in foreign direct investment (FDI) in the first six months of FY20. This is a factor pointed out by the government side too, while defending the strength in the economy. This, with the exports by the services sector are at levels higher than those being achieved by the other emerging economies.