India to outpace China as Asia’s fastest – growing economy in 2015 – FT

FXStreet (Mumbai) – Shifting trade patterns, cheaper oil and a slowing Chinese economy are helping to shake up the league table of Asian growth, with the Philippines and Vietnam joining India as the region’s pacesetters, and Indonesia and Thailand falling to the bottom of the class.

Although the World Bank expects China to remain Asia’s fastest-growing economy until 2017, many private sector analysts believe India will outpace its neighbor as soon as this year.

HSBC forecasts Indian growth of 7.8 per cent in 2015 compared with 7.3 per cent for China.

Lower oil prices have given the Reserve Bank of India greater freedom to cut interest rates and lessened the threat posed by the country’s stubborn current account deficit. There is also hope that the pro-business government of Narendra Modi will be able to unlock India’s economic potential, just as China’s multi-decade boom begins to fade.

India is expected to report an annual growth rate of 7.3 per cent in the first quarter of this year when it releases data on Friday, putting it ahead of China’s
7 per cent for the second consecutive quarter. However, much of that is down to a change in the way India calculates growth, which has added about 2 percentage points to the headline figure.

Shifting trade patterns, cheaper oil and a slowing Chinese economy are helping to shake up the league table of Asian growth, with the Philippines and Vietnam joining India as the region’s pacesetters, and Indonesia and Thailand falling to the bottom of the class.

(Market News Provided by FXstreet)