Asia is now the engine of world growth. The U.S. economy grew only 0.6 percent in the first quarter while Asian growth continued to surge. India’s economy posted year-on-year growth of 9.4 percent in the fiscal year ending March 31, 2007, which was up from 9.0 percent in the previous year. It also marked the second fastest annual growth since the country became independent in 1947. The record growth occurred in 1998/99 when the economy grew 10.5 percent. First quarter 2007 GDP growth was 9.1 percent, up from 8.7 percent in the previous quarter.
India is not alone in this growth. In Japan, Asia’s largest economy, corporate spending in the first quarter of 2007 surged 13.6 percent from year ago levels. This exceeded all expectations and is likely to lead to first quarter GDP growth being revised upward to 3.2 percent from the initial estimate of 2.4 percent.

Despite its political woes, Thailand’s economy was much stronger than expected in the first quarter. Quarterly GDP growth reached 4.3 percent in the first quarter, which was above most expectations. Export growth is continuing to drive the economy. First quarter exports surged 19 percent providing the country with a 4.1 billion dollar trade surplus during the quarter. Thailand’s private consumption was also strong, increasing 1.3 percent from a year ago in the first quarter.

The Asian boom has spread to the Philippines. First quarter GDP growth reached 6.9 percent from a year earlier. This was the highest rate of growth since 1990.