India’s Gross Domestic Product GDP grew 5.8 per cent in the January-March period, government data showed on Friday. With that, India lost its position as the fastest-growing major economy of the world to China for the first time in one-and-a-half years. China’s economy logged a growth of 6.4 per cent in the March quarter. Friday’s data also meant the economy logged an average growth of 6.8 per cent for the full financial year 2018-19. April-June economic growth rate could be “relatively slower”, Finance Secretary Subhash Chandra Garg said.
By A Correspondent / New Delhi
India’s economic growth rate slowed to five-year low of 5.8 per cent in January-March 2018-19, due to poor performance in agriculture and manufacturing sectors.
According to the Central Statistics Office (CSO) data released today, GDP growth during 2018-19 fiscal stood at 6.8 per cent, lower than 7.2 per cent in the previous financial year.
The growth in gross domestic product (GDP) was slowest since 2014-15. The previous low was 6.4 per cent in 2013-14.
The National Statistical Office (NSO), Ministry of Statistics and Programme Implementation, has released the Provisional Estimates of National Income for the financial year 2018-19, both at Constant (2011-12) and Current Prices.
India’s Finance Secretary, Subhash Chandra Garg, said the economy could grow “relatively slower” this quarter but would start turning around from the July-September quarter with favourable interest rates and an improvement in liquidity.
He said the last quarter was hurt by weak consumption demand and tepid private investment. Finance ministry sources say new finance minister Nirmala Sitharaman could cut taxes in her first full-year budget on July 5 to boost demand.
The Reserve Bank of India is also expected to reduce interest rates at its June 4-6 policy meeting.
On Friday, the Ministry of Statistics and Programme Implementation cut its growth estimate for the fiscal year that ended on March 31 to 6.8%, the lowest in five years, from a previously projected 7%.
Separate data released showed India’s unemployment rate rose to 6.1% in the 2017-18 fiscal year, matching data earlier leaked to a newspaper that said it was the highest level in at least 45 years.
Several indicators — automobile sales, rail freight, petroleum product consumption, domestic air traffic and imports — indicate a slowdown in domestic consumption.
Private investment in India grew 7.2% in the March quarter, down from 8.4% in the previous quarter. Capital investment growth slowed to 3.6% from 10.6%, government data showed.
Government spending, however, rose 13.1% in the March quarter from 6.5% ahead of the April-May elections, widening the fiscal deficit in the last financial year.
The farm sector contracted 0.1% in the March quarter compared with 2.7% growth in the previous quarter, while manufacturing grew 3.1%, slower than 6.7% in the previous quarter.
Corporate earnings grew at a six-quarter low of 10.7% during January-March period on weakening consumer sentiment and softening commodity prices, ICRA, the Indian arm of the ratings agency Moody’s, said on Tuesday, citing a sample of more than 300 companies.
But many economists and officials expect the government to push long-pending reforms starting in the next parliamentary session beginning on June 17, after its landslide election victory.
“Big-bang” economic programmes in the first 100 days of Modi’s second term could focus on privatisation of state assets and relaxation of labour and land rules for businesses, a top official at the government’s main think-tank said.
These are presented in Statements 1 to 4.
2. Quarterly Estimates of Gross Domestic Product (GDP) for the fourth quarter (January-March) of 2018-19, both at Constant (2011-12) and Current Prices along with the corresponding quarterly estimates of expenditure components of GDP are also released. The four quarters of a financial year are denoted by Q1, Q2, Q3 and Q4.Estimates including growth rates of Q1, Q2 and Q3 of 2018-19 released earlier have been revised in accordance with the revision policy of National Accounts.GDP at Constant (2011-12) Prices in Q4 of 2018-19 is estimated at `37.20lakh crore, as against `35.15lakh crore in Q4 of 2017-18, showing a growth rate of 5.8 percent. Quarterly estimates for the years 2016-17, 2017-18, and 2018-19 are presented in Statements 5 to 8.
3. GDP growth rates for 2018-19and Q1, Q2,Q3 and Q4 of 2018-19 atConstant (2011-12) and Current Prices are given below:
| Growth Rates of GDP | ||
| Constant Prices(2011-12) | Current Prices | |
| Annual 2018 -19 | 6.8 | 11.2 |
| Q1 2018-19 (April-June) | 8.0 | 12.6 |
| Q2 2018-19 (July-Sep) | 7.0 | 12.0 |
| Q3 2018-19 (Oct-Dec) | 6.6 | 11.0 |
| Q4 2018-19 (Jan-Mar) | 5.8 | 9.4 |
I. PROVISIONAL ESTIMATES OF NATIONAL INCOME, 2018-19
4. The Second Advance Estimates of National Income for the year 2018-19were released on 28th February, 2019. These estimates have now been revised incorporating latest estimates of Agricultural Production, Index of Industrial Production(IIP) and performance of key sectors like, Railways, Transport other than Railways, Communication, Banking, Insurance and Government Revenue Expenditure.With the introduction of Goods and Services Tax (GST) from 1st July 2017 and consequent changes in the tax structure, the total Tax Revenue used for GDP compilation include non-GST Revenue and GST Revenue.Early results on the performance of Corporate Sector for April-December 2018 which were used in The Second Advance Estimates have been revised on the basis of latest available information.
5. The salient features of these estimates are detailed below:
I. (a) Estimates at Constant (2011-12) Prices
Gross Domestic Product
6. Real GDP or GDP at Constant (2011-12) Prices for the year 2018-19 is now estimated at`140.78lakhcroreshowing a growth rate of 6.8percentover First Revised Estimates of GDPfor the year 2017-18of`131.80lakhcrore, released on 31st January, 2019.
Gross Value Added (GVA)atBasic Prices
7. Real GVA, i.e, GVA at Basic Constant (2011-12)Prices for the year 2018-19 is now estimated at `129.07 lakh crores showing a growth rate of 6.6percent over First Revised Estimates of GVA for the year 2017-18of`121.04 lakh crore, released on 31stJanuary, 2019.
8. The sectors which registered growth rate of over 7.0percent are’public administration, defence and other services’ (8.6 percent), construction (8.7 percent), ‘financial, real estate and professional services’ (7.4 percent), ‘electricity, gas, water supply &other utility services(7.0 percent)’.The growth in the ‘agriculture, forestry and fishing’, ‘mining &quarrying’, ‘manufacturing’and ‘trade, hotels, transport, communication and services related to broadcasting’ isestimated to be 2.9percent, 1.3percent, 6.9 percentand 6.9 percent respectively.
9. Industry analysis
Agriculture
9.1. The ‘Agriculture, Forestry and Fishing’ sector has shown a growth rate of 2.9percent as against previous year’s growth rate of 5.0 per cent.The GVA estimates of this sector have been compiled using the provisional estimates(3rd Advance Estimates of crop production 2018-19)providedby the Department of Agriculture, Cooperation & Farmers Welfare (DAC & FW), Ministry of Agriculture. In case of Livestock sector, estimates of production, mainly in the form of production targets for Milk, Egg, Meat and Wool from the Department of Animal Husbandry & Dairying, and Fish production data from Department of Fisheries (DADF), Ministry of Agriculture & Farmers Welfare have been used.
Mining and Quarrying
9.2 The ‘Mining and Quarrying’ sector has shown a growth rate of 1.3 percent as against previous year’s growth rate of 5.1 per cent. The Index of Industrial Production of Mining registered growth of2.8 percent during 2018-19as compared to 2.3 percent during 2017-18. The Private Corporate sector growth in the Mining sector was estimated using the latest available information on major Listed Companies for the financial year 2018-19.Further, growth in WPI of Minerals, Coal, Crude Oil and Natural Gas is estimated at 11.3, 7.3,(-)4.2and (-)1.8 percent respectively during 2018-19 as compared to 8.3, 2.6, (-)0.9 and 2.4 percent respectively during 2017-18.
Manufacturing
9.3 The growth in the ‘Manufacturing’sector is estimated at 6.9percent as against previous year’s growth rate of 5.9 percent. The Private Corporate sector growth (which has a share of around70 percent in the Manufacturing sector) was estimated from available data of listed companies with BSE and NSE. The Quasi – Corporate and Unorganized segment (which has a share of over 20 percent in the Manufacturing sector) has been estimated using IIP of Manufacturing. The IIP of Manufacturing registered a growth rate of 3.5percent during 2018-19.The Wholesale Price Index (WPI), in respect of the manufactured products registered a growth of 3.7percent during April-March, 2018-19 as compared to 2.7 percent during April-March, 2017-18.
Electricity, Gas, Water Supply and Other Utility Services
9.4 GVA at Basic Prices for 2018-19 from ‘Electricity, Gas, Water Supply and Other Utility Services’ sector is estimated at 7.0percent as against previous year’s growth rate of 8.6 percent. The key indicator of this sector, namely,IIP of Electricity registered a growth rate of 5.2 percent during April-March, 2018-19.
Construction
9.5 GVA at Basic Prices for 2018-19 from ‘Construction’ sector is estimated at 8.7percent as against previous year’s growth rate of 5.6 percent. Key indicators of Construction sector, namely, production of Cement and consumption of finished Steel registered growth rates of 13.3 per cent and 7.5 percent, respectively, during 2018-19 as compared to 6.3 percent and 7.9 percent respectively, during 2017-18.
Trade, Hotels, Transport, Communication and Services related to Broadcasting
9.6. GVA at Basic Prices for 2018-19 from this sector is estimated at 6.9percentas against previous year’s growth rate of 7.8 percent. Key indicator used for estimating GVA from Trade sector is the Sales Tax growth. With introduction of GST, Sales Tax data is now subsumed under GST. Therefore, a comparable estimate of turnover based on Sales Tax has been estimated. Methodology of estimation is as explained in the Annex to the press note on estimates of GDP for the second quarter (July-September) of 2017-18 released on 30th November, 2017. Indicator used for measuring GVA from Hotels and Restaurant sector is the Private Corporate growth in this sector. Among the other Services sectors, the key indicators of Railways, namely, the Net Tonne Kilometres and Passenger Kilometres have shown growth rate of 6.6 per cent and 1.3 percent respectively during 2018-19. In case of other Transport sectors, Passengers Handled by the Civil Aviation, Cargo Handled by the Civil Aviation and Cargo Handled at Major Sea Ports registered growth rates of 11.6 percent, 2.6 percent and 3.0 percent, respectively, during 2018-19. Sales of Commercial Vehicles registered 17.6 percent growth during April-March2018-19.
Financial, Real Estate and Professional Services
9.7 The sector’Financial, Real Estate and Professional Services’ has shown a growth rate of 7.4percent as against previous year’s growth rate of 6.2 percent. Major component of this industry is the Real Estate and Professional Services which has a share of 72.0percent. The key indicators of this sector are the quarterly growth of Corporate sector for Real Estate, Business services and Computer related activities which is estimated from available data from Listed Companies. The key indicators of Banking, namely, Aggregate Bank Deposits and Bank Credits have shown growth of 10.0 percent and 13.3 percent, respectively,during March,2019.
Public Administration, Defence and Other Services
9.8 The sector ‘Public Administration, Defence and Other Services’ has shown a growth rate of 8.6percentas against previous year’s growth rate of 11.9 per cent. The key indicator of this sector namely, Union Government Revenue Expenditure grew by 12.5 percent during this period.
Gross National Income
10. The Gross National Income (GNI) at 2011-12 Prices is now estimated at `139.32lakhcroreduring 2018-19, as against the previous year’s estimate of`130.34lakh crore. In terms of growth rates, the Gross National Income is estimated to have risen by 6.9percent during 2018-19, in comparison to the growth rate of 7.2percent in 2017-18.
Per Capita Income
11. The Per Capita Income in real terms (at 2011-12 Prices) during 2018-19 is estimated to have attained a level of `92565 as compared to`87,623for the year 2017-18. The growth rate in Per Capita Income is estimated at 5.6percent during 2018-19, as against 5.7 percent in the previous year.
Price indices used as deflators
12. The Wholesale Price Index (WPI), in respect of the groups Food Articles, Minerals, Manufactured Products, Electricity and all commodities, has risen by 0.4 percent, 11.3 percent, 3.7 percent, 6.0 percent and 4.3 percent, respectively during April-March, 2018-19. The Consumer Price Index has shown a rise of 3.4 percent during April- March, 2018-19.
I. (b) Estimates at Current Prices
Gross Domestic Product
13. GDP at Current Prices for the year 2018-19 is estimated at `190.10lakh crore, showing a growth rate of 11.2 percent over the First Revised Estimates of GDP for the year 2017-18 of `170.95 lakh crore.
14. All sectors,except Agriculture, i.e., ‘Mining & Quarrying’, ‘Manufacturing’, ‘Electricity, Gas, Water Supply and Other Utility Services’, ‘Construction’,‘Trade, Hotels, Transport, Communication and Services Related to Broadcasting’, ‘Financial, Real Estate & Professional Services’, and ‘Public Administration, Defence and Other Services’have registered growth rate of over 9.0 percent and above at Current Prices.
National Income
15. The GNI atCurrent Prices is estimated at `188.17 lakh crore during 2018-19, as compared to `169.10lakh crore during 2017-18, showing a rise of 11.3percent.
Per Capita Net National Income
16. The Per Capita Income at Current Prices during 2018-19 is estimated to have attained a level of`1,26,406as compared to the estimates for the year 2017-18 of`1,14,958showing a rise of10.0percent.
II ANNUAL ESTIMATES OF EXPENDITURES OF GDP, 2018-19
17. Along with the ProvisionalEstimates of GDP by economic activity, the NSO is also releasing the estimates of expenditures of the GDP at Current and Constant (2011-12) Prices. These estimates have been compiled using the data on indicators available from the same sources as those used for compiling GVA estimates by economic activity, detailed data available on Merchandise Trade in respect of Imports and Exports, Balance of Payments, and monthly expenditure of Central and State Government. As various components of expenditure on Gross Domestic Product, namely, Consumption Expenditure and Capital Formation, are normally measured at Market Prices, the discussion in the following paragraphs is in terms of Market Prices only.
Private Final Consumption Expenditure
18. Private Final Consumption Expenditure (PFCE) at Current Prices is estimated at `112.90lakhcrore in 2018-19as against`100.83lakhcrore in 2017-18. At Constant (2011-12) Prices, the PFCE is estimated at`80.17lakhcrore in 2018-19 as against`74.17lakhcrore in 2017-18. In terms of GDP, the rates of PFCE at Current and Constant (2011-12) Prices during 2018-19 are estimated at 59.4percent and 56.9percent, respectively, as against the corresponding rates of 59.0 percent and 56.3percent, respectively in 2017-18.
Government Final Consumption Expenditure
19. Government Final Consumption Expenditure (GFCE) at Current Pricesisestimatedat`21.35lakhcrore in 2018-19 as against`18.86lakh crore in 2017-18. At Constant (2011-12) Prices, the GFCE is estimated at`15.06lakh crore in 2018-19as against `13.79lakh crore in 2017-18. In terms of GDP, the rates of GFCE at Current and Constant (2011-12) Prices during 2018-19are estimated at 11.2percent and 10.7percent, respectively, as against the corresponding rates of 11.0percent and 10.5percent, respectively in 2017-18.
Gross Fixed Capital Formation
20. Gross Fixed Capital Formation (GFCF) at Current Prices is estimated at`55.70lakh crore in 2018-19as against`48.97lakh crore in 2017-18. At Constant (2011-12) Prices, the GFCF is estimated at `45.48lakhcrore in2018-19 as against `41.37lakh crore in 2017-18. In terms of GDP, the rates of GFCF at Current and Constant (2011-12) Prices during 2018-19 are estimated at 29.3percent and 32.3percent, respectively, as against the corresponding rates of 28.6percent and 31.4percent, respectively, in 2017-18.
21. Estimates of Gross/ Net National Income and Per Capita Income, along with GVA at Basic Prices by kind of economic activity and the Expenditures of GDP for the years 2016-17, 2017-18 and 2018-19 at Constant (2011-12) and Current Prices are given in Statements 1 to 4.
III QUARTERLY ESTIMATES OF GDP FOR Q4 (JANUARY-MARCH), 2018-19
III.(a) Estimates at Constant (2011-12) Prices
22. GDP at Constant (2011-12) Prices in Q4 of2018-19 is estimated at `37.20lakh crore, as against`35.15lakhcrore in Q4 of 2017-18, showing a growth rate of 5.8percent. GVA at Basic Prices at Constant (2011-12) Prices in Q4 of 2018-19 is estimated at `33.06lakhcrore, as against `31.27lakhcrore in Q4 of 2017-18, showing a growth rate of 5.7percent.
23. Growth rates in various sectors in Q4 of 2018-19 are as follows: ‘Agriculture, Forestry and Fishing’ (-0.1 percent), ‘Mining and Quarrying’ (4.2percent), ‘Manufacturing’ (3.1percent), ‘Electricity, Gas, Water Supply and Other Utility Services’ (4.3percent) ‘Construction’ (7.1percent), ‘Trade, Hotels, Transport and Communication’ (6.0percent), ‘Financial, Real Estate and Professional Services’ (9.5percent), and ‘Public Administration, Defence and other Services’ (10.7percent).
24. According to the latest estimates of IIP, the Index of Mining, Manufacturing and Electricity registered growth rates of 2.2percent, 0.1 percentand 1.5 percent, respectively, in Q4 of 2018-19, as compared to the growth rates of 1.1 percent, 7.5 percent and 6.1 percent, respectively in these sectors in Q4, 2017-18. Performance of corporate sector based on available information from BSE/NSE has been taken into account for compiling quarterly estimates.
25. The key indicators of Railways, namely, the Net Tonne Kilometers and Passenger Kilometers have shown growth rates of 5.8percentand (-)0.5percent,respectively in Q4 of 2018-19, as against the growth rates 7.4 percent and 9.9, in the corresponding period of previous year. In the Transport and Communication sectors, Cargo Handled at Major Ports registered a growth rate of 0.1 percent in Q4 of 2018-19.The Trade, Hotels, Transport, Communication and Services Related to Broadcasting sector have registered a growth of6.0percent inQ4 of 2018-19 as against6.4percent in Q4 of 2017-18. The sector ‘Public Administration, Defence and Other Services’ has shown a growth rate of10.7 percent in Q4 of 2018-19 as against the growth rate of 15.2per cent in 2017-18.
26. The PFCE and GFCF at Constant (2011-12) Prices in Q4 of 2018-19 are estimated at`21.11lakh croreand`11.42lakh crore, respectively. The rates of PFCE and GFCF as percentage of GDP in Q4 of 2018-19were56.8percent and 30.7percent, respectively, as against the corresponding rates of 56.0percent and 31.4percent, respectively in Q4 of 2017-18.
III.(b)Estimates at Current Prices
27. GDP at Current Prices in Q4 of 2018-19 is estimated at`50.16lakh crore, as against`45.85lakhcrore in Q4 of 2017-18, showing a growth of9.4percent. GVA at Current Basic Prices in Q4 of2018-19 is estimated at`44.02lakh crore, as against `40.20lakhcrore in Q4 of 2017-18, showing a growth of 9.5percent.Growth rates in various sectors are as follows: ‘Agriculture, Forestry and Fishing’ (3.8percent), ‘Mining and Quarrying’ (9.7percent), ‘Manufacturing’ (5.7percent), ‘Electricity, Gas, Water Supply and Other Utility Services’ (8.8percent) ‘Construction’ (10.3percent), ‘Trade, Hotels, Transport and Communication’ (9.3percent), ‘Financial, Real Estate and Professional Services’ (13.3percent), and ‘Public Administration, Defenceand Other Services’ (16.3 percent).
28. The PFCE and GFCF at Current Prices in Q4 of 2018-19 are estimated at `29.75lakh crore and `13.99 lakh crore, respectively. The rates of PFCE and GFCF at Current Prices as percentage of GDP in Q4 of 2018-19 are estimated at 59.3percent and 27.9percent, respectively, as against the corresponding rates of 59.0percent and 28.6percent, respectively in Q4 of 2017-18.
29. The Wholesale Price Index (WPI), in respect of the groups, Food Articles, Minerals, Manufactured Products, Electricity and all commodities, has risen by 4.1 percent, 10.0 percent, 2.4 percent, 4.4 percent and 3.0 percent, respectively during Q4 of 2018-19. The Consumer Price Index has shown a rise of 2.5 percent during Q4 of 2018-19.
30. Estimates of GVA at Basic Prices by kind of economic activity and the expenditures of GDP for the four quarters of 2016-17, 2017-18and 2018-19 at Constant (2011-12) and Current Prices, are given in Statements 5 to 8.
31. The next release of quarterly GDP estimate for the quarter April-June, 2019 (Q1 of 2019-20) will be on 30.08.2019.
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