The government has come out in strong defence of the quarter one gross domestic product (GDP) reading of 13.5 percent versus the Reserve Bank of India’s (RBI) estimate of 16.2 percent. The reading is down from the 20.1 percent recorded in the corresponding quarter last year, data showed.

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Brokerages like Moody's, Citi and Kotak have cut India's annual growth expectations at the back of this reading and lowered their forecast to 6.7 to 6.8 percent. However, the government believes that the first quarter reading is consistent with the overall growth estimation of around 7-7.4 percent for the current financial year.

The reasons that the government has mentioned is that in the remaining two quarters, India will have to grow just at around 5 percent to achieve the fiscal growth target.

Another factor pointed out is that the government's capex between April and July is 62 percent higher year on year (YoY) and this is a major chunk of the overall 7 lakh crore number that has been set out for this year. As per the government data, the high-frequency indicator is showing a big uptick.

Last, the government is not expecting any major change in the borrowing target and is pretty confident about achieving the fiscal deficit aim in the current financial year.

Also Read | Keki Mistry expresses confidence in the Indian economy despite subpar Q1 GDP

Suresh Tantia, the Senior Investment Strategist at Credit Suisse, backed the India growth story expectation.

“Right now the issue is that the global growth is slowing down. When the global economy is struggling to grow even by 1-2 percent, the Indian economy last quarter grew by 13 percent plus and this financial year it is expected to grow by 7 percent. So everybody is looking for growth and India is one place which is offering growth right now,” he said.

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(Edited by : Abhishek Jha)