India's economy surged in the first three months of 2004 and analysts are predicting the boom will continue.
The government and central bank need to keep growth going
Growth from January to March was 8.2% compared with a year earlier. But the figure was lower than forecast and down from 10.4% the previous three months.
Analysts, however, remained upbeat because of the global economic recovery and the recent good monsoon seasons.
Agriculture accounts for about 25% of total gross domestic product (GDP) and crops are at record levels.
As a result, economic growth in the past fiscal year, which runs from March to March, was 8.2% - the fastest expansion in 15 years.
However, the boom may increase pressure on the central bank to raise borrowing costs, analysts said.
The much improved agricultural sector - driven by a good monsoon season - has helped boost consumer spending among the more than 600 million people who rely on the land for their living.
Too much monsoon rain can be as much a problem as too little
According to the statistical office, agricultural production rose 10.5% in the first quarter.
Analysts are expecting farm output to dip in coming months and the first quarter figure compares with growth of 16.5% in the previous three months.
"The farm sector has done exceptionally well in the 2003-2004," said Manas Paul, chief economist at Securities Trading Corporation of India. "But in the next year, it might not be possible to sustain this growth level."
Other sectors are expected to take up the slack and performed well during the first quarter.
Manufacturing output increased 7.6% from the previous year; while financing, insurance and real estate services saw growth of 8.5% - helped by lower borrowing costs.
The economy also got a lift from an increasing number of tourists, pushing expansion to 14% in the trade, hotels, transport and communication industries.
"Growth in the current year is likely to be driven by the manufacturing sector," said Kishlaya Patak of Standard Chartered Bank.
Mr Patak said he expects the economy to expand by 7% in coming fiscal year, a view that is echoed by many of his peers.