At 8.2 per cent, GDP clocks highest growth rate in 3 years

Sep 01, 2018, 04:28

The growth in the "agriculture, forestry and fishing", "mining and quarrying", "Trade, hotels, transport, communication and services related to broadcasting" and financial, real estate and professional services is estimated to be 5.3 percent, 0.1 percent, 6.7 percent, and 6.5 percent respectively during this period.

India is a massive importer of oil, however, and analysts say high crude prices and a tumbling rupee threaten to derail growth.

With China's growth coming down to 6.7 per cent in April-June 2018 from 6.8 per cent in January-March of the year, India remained the fastest-growing large economy in the world.

GDP at current prices in Q1 of 2018-19 is estimated at Rs 44.33 lakh crore, as against Rs 38.97 lakh crore in Q1 of 2017-18, showing a growth rate of 13.8 percent.

The ministry said that Gross Fixed Capital Formation (GFCF) at current prices stood at Rs 12.75 lakh crore in Q1 of 2018-19 as against Rs 11.20 lakh crore in Q1 of 2017-18. "Indian economy is witnessing unprecedented growth in every sector, from manufacturing to agriculture", Bharatiya Janata Party (BJP) president Amit Shah said on Twitter.

Finance Minister Arun Jaitley tweeted, "More India's GDP for the first quarter this year growing at 8.2 per cent in otherwise an environment of global turmoil represents the potential of New India". Agricultural growth, which mainly captures the 2017-18 Rabi season activity, increased from 3% to 5.3% between Q1 2019 and Q1 2018.

Part of this slowdown can be traced to slower growth in public administration, defence and other services, which largely connote government spending. "Q1 growth rate is based on the lowest base (5.6) in the last 8 quarters", he said.

ALSO READ: GDP growth touches 8.2% in Q1FY19; July core sector growth at 6.6%. While this shows a continuing process of economic recovery, the presence of base effect calls for caution in declaring that India has placed itself in a trajectory of 8% plus growth, he said.

"We expect growth to be 7.5 per cent for the full year".

Workers assemble tricycles inside a manufacturing unit in Ahmedabad, India, August 30, 2018.

"This is probably the best GDP trend we have seen in the first half of the fiscal year", said Shashank Mendiratta, India economist at ANZ Bank.

He also gave a tabulated data showing that the GDP was 8.1 per cent in the first quarter of 2016-17, which declined to 7.6 per cent in the second quarter, declining further to 6.8 per cent and 6.1 per cent in the third and fourth quarter of 2016-17. As The Wire has pointed out, GVA has over the last few years become a more important measure of economic growth as it removes the impact of subsidies and indirect taxes.