India is likely to remain insulated from the developments in the Chinese economy provided the government carries out structural reforms to take the economy to an eight per cent growth path, said Standard and Poor’s (S&P) Global Ratings.

Remaining optimistic on India, it has pegged the growth rate at 7.9 per cent in 2016-17 and eight per cent a year later. Growth in 2015-16 is pegged at 7.6 per cent.

“There are no big changes to the outlook,” it said in its APAC Economic Snapshots, adding that downside risks to the growth forecast have eased in recent months with a positive monsoon forecast, financial markets calming, a prudent Budget, and the structural reform agenda continuing to make headway.

The forecast is slightly more optimistic than that of the government’s, which has pegged the GDP growth rate at seven per cent to 7.75 per cent this fiscal.

Finance Minister Arun Jaitley has said a growth of 7.75 per cent to eight per cent may be possible in the current scenario where the global economy is in the midst of a slowdown.

However, S&P said, “India remains largely insulated from the China-driven ups and downs facing the rest of the region.”

Terming the passage of the Insolvency and Bankruptcy Code, 2016 in Parliament as “big news”, the agency said it will help clean banks’ books and improve the credit transmission channel.

“The goods and services tax is the next item on the ‘to do’ list,” it further stressed.

But, the agency was concerned over the falling Purchasing Manager’s Index, drop in factory output that grew a mere 0.1 per cent in March 2016, and also the weak trade flows.

It further said that it is waiting for signs of sustained rural consumption as well as investment to support growth.

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