2017.05.2518:59:00UTC+00Indian Economy Likely to have Grown Sub-7 Pct in Q1 2017, says Scotiabank

India is set to release its first quarter economic growth data next week. According to a Scotiabank research report, the Indian economy is likely to have continued to ease from 8.6 percent year-on-year in the first quarter of 2016 to a sub-7 percent figure in the March quarter of 2017.

The effect of the demonetization that ended the circulation of high-denomination Rs 500 and Rs 1000 notes has been a considerable culprit. Their use had been declared as null and void as legal tender in an attempt to bring above-ground more of the economy and reduce counterfeit money in circulation and associated corruption while encouraging more of an evaluation toward electronic banking and taxable activities.

“It has been fairly well understood that a consequence in the short-run was to reduce growth potential as a downpayment upon longer-run benefits”, added Scotiabank.