Goldman Sachs: India‘s potential GDP growth around 6–7%

Timothy Moe, co-head of Economics, Commodities and Strategy (ECS) Research in Asia & chief Asia Pacific regional equity strategist at Goldman Sachs Research observed that the current cyclical recovery, dramatic improvements in ease of doing business and other reforms that have flown ‘under the radar’ are positive signs for India’s long-term growth and corporate earnings environment.

“The long-term growth perspective or potential for India is one of the highest in the Asia Pacific region. India has a potential GDP growth rate of between 6–7 percent or perhaps even more,” Moe is quoted to have said. “The long-term positive drivers are the five year very strong growth potential and the fact that we have got a cyclical recovery in the economy, and what appears to us to be is the beginning of a cyclical upturn in profits,” he added.

He also mentioned that the impact of reforms has been a mixed bag, considering some of the larger headline reforms such as the Goods & Services Tax (GST) have not yet been passed due to domestic political hurdles. However, he noted that a lot of micro level reforms including the ease of doing business have improved dramatically.