Indian economy grows by 8.8 per cent

India's economy grew at its fastest rate for more than two years in the last quarter, official figures have shown.

GDP rose by 8.8 per cent in the three months to June compared with the same period last year.

India – the world's eleventh largest economy – is the second fastest-growing after China.

Strong industrial and mining output helped boost the growth rate, India's office said.

Industrial output rose more than 12 per cent.

Mining was up by almost nine per cent, while agriculture saw a 2.8 per cent rise.

In July, India's central bank said it expected annual growth for the current financial year to come in at about 8.5 per cent.

But the bank has also said bringing down inflation remains a priority.

The inflation rate topped 11 per cent last month and the strong performance in the economy is expected to encourage policymakers to continue raising interest rates.