India's GDP growth rate accelerated to 7.9 per cent in March quarter beating estimates

Highlights India's GDP growth accelerated to 7.9% in March quarter

Data is ahead of consensus estimates of 7.5% growth in Q4

India cemented its pole position as fastest-growing major economy

India cemented its pole position as the world's fastest-growing major economy, with March quarter GDP (gross domestic factor) growth accelerating to 7.9 per cent versus a revised 7.2 per cent in December 2015.The latest data is ahead of consensus estimates of 7.5 per cent growth in Q4 and coincides with Prime Minister Narendra Modi's government completing two years in office."Momentum is building up faster than anticipated, and there is demand pick-up in the horizon. This definitely spells out a positive story that there will soon be a recovery in private sector capex," said Subhhda Rao, chief economist with Yes Bank. ( Read more India maintained its lead over China, the world's second largest economy, where GDP growth slowed to a seven-year low of 6.7 per cent between January and March 2016.Growth in the March quarter was driven by a rebound in farm output, an improvement in mining and a sharp pickup in electricity production. The farm sector grew by 2.3 per cent from a year ago compared with a 1 per cent contraction in the December quarter. (Mining grew 8.6 per cent in the March quarter, up from 7.1 per cent in the previous quarter. Electricity, water and gas production growth jumped to 9.3 per cent from 5.6 per cent in the December quarter.For 2015-16 fiscal year, GDP growth accelerated to 7.6 per cent as compared to 7.2 per cent in 2014-15. Though India ended FY16 on a positive note, economists and market analysts are cautious about the current year (FY17) numbers. According to the Economic Survey, GDP growth is expected to be flat in the current fiscal year.India's growth has been held back by back-to-back droughts that have hit the farm sector, which employs nearly 50 per cent of the population and contributes over 15 per cent to the GDP. Simultaneously, a slowdown in the global economy has hurt exports, which have contracted for 17 straight months, raising worries for the government.Finance Minister Arun Jaitley has maintained that India's GDP growth is " much less " than its potential.(With inputs from Reuters)