Two Asian economies - India and Indonesia - will see a pick-up in GDP growth in 2018, reaping benefits of the economic reforms, says a report.
According to the report by BMI Research (a unit of Fitch Group), a majority of Asian economies barring India and Indonesia, will see their growth rates slow slightly this year.
"Following an impressive year in which 10 out of 14 Asia Pacific economies saw their real GDP growth rates increase in year-on-year terms in 2017, we are forecasting just two countries to experience a pick-up in headline real economic growth in 2018. They are India and Indonesia," it said.
In the Indian context, adapting to the new GST regime, economic reforms aiding growth and recapitalisation plan for public sector banks will lead to increased investment growth and economic activity over the coming quarters, it said.
As per the report, India's real GDP growth is expected to pick up to 6.7 per cent in 2018-19 (April-March)from 6.4 per cent in 2017-18.
It said structural economic reforms bode well for India and Indonesia.
"In our view, the pick-up in economic growth in India and Indonesia over the coming quarters will be driven by continued progress of economic reforms and improvements to the still- challenging business environment," the report noted.
It further said, "Indian Prime Minister Narendra Modi and Indonesia President jokowi Widodo both took office in 2014 and are reform-minded, and therefore, investor-friendly policies are still on their agenda over the coming quarters".
However, risk to this outlook is rising oil prices, which is a "bane" for both India and Indonesia. Moreover, both countries are likely to go for state elections in 2018 and general elections in 2019, which could result in an uncertain investment climate, the report said.
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