The country’s gross domestic product (GDP) growth rate for the first quarter (April – June) of fiscal year 2018-19
surged to a more than two-year high of 8.2 per cent, government data showed on Friday.
The gross value added (GVA) growth rate for the said quarter came at 8 per cent. The GVA gives a picture of the state of economic activity from the producers’ side or supply side, as opposed to GDP which gives the picture from the consumers’ side or demand perspective.
The GDP growth rate in the last quarter was 7.7 per cent while that in the first quarter of the previous financial year (2017-18) stood at 5.59 per cent.
Speaking on the GDP numbers, economic affairs secretary SC Garg told news agency ANI, “Economic performance is back to very normal. We had over 8% of quarterly growth last time in first quarter of 2016-17. Now after 8 quarters, we are at 8.2%. From 8.1% we have come to 8.2% which signals economic growth now on steady high growth path.”
Economic performance is back to very normal. We had over 8% of quarterly growth last time in first quarter of 2016-17. Now after 8 quarters,we are at 8.2%.From 8.1% we have come to 8.2% which signals economic growth now on steady high growth path: Subhash C Garg, DEA Secretary pic.twitter.com/cZOdvnoX3j
— ANI (@ANI) August 31, 2018
The rally in growth rate can be attributed to the manufacturing sector which grew by 13.5 per cent in the first quarter as compared to a negative growth of 1.8 per cent in the same quarter previous year.
“The numbers are pretty solid and mostly driven by public investment and higher consumption, especially, in the rural-end with this being a pre-election year. This is probably the best GDP trend we have seen in the first half helped by a favourable base. Going ahead, I expect the growth rate to be moderate as private nvestment is unlikely to grow at a faster rate due to stressed assets,” Shashank Mendiratta, India Economist,ANZ Bank, Bengaluru told news agency Reuters.
The latest GDP data reinforces India’s tag of the fastest growing economy, with China posting a 6.7 per cent growth rate in second quarter. China follows a January – December fiscal calendar, unlike India’s April – March cycle .
Earlier this year, India’s $2.6 trillion economy surpassed France’s in 2017 to be the world’s sixth largest, according to World Bank data.
In its annual report for the year 2017-18, released on Wednesday, the Reserve Bank of India (RBI) expects the country’s economic growth rate to come at to 7.4 per cent for the full fiscal year 2018-19, backed by pick up in industrial activity and good monsoon.
In another set of data released by the government, eight core sectors grew by 6.6 per cent in July pushed by healthy output in coal, refinery products, cement and fertiliser.
