India's GDP estimated to grow at 7.2% in 2018-19

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India's GDP estimated to grow at 7.2% in 2018-19
India's GDP estimated to grow at 7.2% in 2018-19

New Delhi : Higher manufacturing and agriculture sector output is expected to accelerate India's GDP (gross domestic product) growth rate to 7.2 per cent in 2018-19 from 6.7 per cent in the previous fiscal, official data showed here on Monday.

"Real GDP or GDP at Constant Prices (2011-12) in the year 2018-19 is likely to attain a level of Rs 139.52 lakh crore, as against the 'Provisional Estimate of GDP for the year 2017-18' of Rs 130.11 lakh crore, released on 31st May 2018," the Ministry of Statistics and Programme Implementation said.

"The growth in GDP during 2018-19 is estimated at 7.2 per cent as compared to the growth rate of 6.7 per cent in 2017-18," the Ministry said in the "First Advance Estimates of National Income, 2018-19".

Besides, the growth rate of gross value added (GVA) is anticipated to grow at 7 per cent from 6.5 per cent rate achieved in the previous fiscal.

"Real GVA, i.e. GVA at Basic Constant Prices (2011-12), is anticipated to increase from Rs 119.76 lakh crore in 2017-18 to Rs 128.09 lakh crore in 2018-19.

"Anticipated growth of real GVA at Basic Prices in 2018-19 is 7 per cent as against 6.5 per cent in 2017-18," said the Ministry statement. GVA includes taxes but excludes subsidies.

As per the data, the economic activities which registered a growth of over 7 per cent on a YoY basis were "manufacturing", "electricity, gas, water supply and other utility services", "construction" and "public administration, defence and other services".

The growth in the trade, hotels, transport, communication and services related to roadcasting is estimated to be 6.9 per cent, while financial, real estate and professional services are seen growing at 6.8 per cent. Agriculture, forestry and fishing sector, and mining and quarrying sector are likely to growth at 3.8 per cent and 0.8 per cent, respectively.

Sector-wise, YoY GVA at basic prices for 2018-19 from the consolidated sector of agriculture, forestry and fishing showed a growth of 3.8 per cent from 3.4 per cent in 2017-18.

In addition, GVA in 2018-19 from "manufacturing" sector grew at 8.3 per cent as compared to 5.7 per cent.

"IIP manufacturing registered a growth of 5.6 per cent during April-October 2018-19. The Wholesale Price Index (WPI), in respect of the manufactured products, registered a growth of 4.1 per cent during April-November 2018-19," the estimates document said.

Reacting to the "First Advance Estimates of National Income, 2018-19" Economic Affairs Secretary Subhash Chandra Garg tweeted: "India remains fastest growing major economy globally. At current prices GDP grows by 12.3 per cent rising to 188.41 lakh crore. Per capita GDP at current prices rises to Rs. 141,447."

"Especially gratifying, impressive and promising is the growth in gross fixed capital formation (GFCF). 12.2 per cent real growth in 2018-19 compared to 7.6 per cent in in 2017-18 heralds excellent pick-up in investment activity. GFCF as a ratio to GDP has risen to 32.9 per cent from 31.4 per cent in 2017-18."

India Ratings and Research's Director for Public Finance and Principal Economist Sunil Kumar Sinha said: "As expected, GDP growth recovered sharply in FY19 from 6.7% in FY18. However, the GDP growth in FY19 would have been even better but for the global headwinds caused by an abrupt rise in crude oil prices, strengthening of USD and rising global trade friction."

"These have been quite unsettling for the Indian economy. However, some of the positives that may guide the economy into the new fiscal from demand side are healthy pick-up in investment growth...."