{"id":32265,"date":"2018-10-29T13:19:22","date_gmt":"2018-10-29T07:49:22","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=32265"},"modified":"2018-10-29T13:19:22","modified_gmt":"2018-10-29T07:49:22","slug":"gdp-growth-seen-slowing-to-4-year-low-of-6-5-in-2017-18","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/gdp-growth-seen-slowing-to-4-year-low-of-6-5-in-2017-18\/","title":{"rendered":"GDP growth seen slowing to 4 year low of 6.5% in 2017-18"},"content":{"rendered":"<p><a href=\"http:\/\/www.thehindu.com\/business\/Economy\/gdp-growth-seen-slowing-to-4-year-low-of-65-in-2017-18\/article22378942.ece\"><strong>GDP growth seen slowing to 4 year low of 6.5% in 2017-18<\/strong><\/a><\/p>\n<p><strong>Context <\/strong><\/p>\n<p>The Central Statistics Office (CSO)\u2019s GDP forecast<\/p>\n<p><strong>What has happened?<\/strong><\/p>\n<p>CSO has forecast that GDP growth in the current financial year ending March 31 will slow to a four-year low of 6.5%, from the provisional 7.1% pace seen in 2016-17, dragged down by deceleration in the agriculture and manufacturing sectors<\/p>\n<p><strong>Other forecasts<\/strong><\/p>\n<ul>\n<li><strong>Gross Value Added (GVA) <\/strong>was also projected to expand by 6.1% in 2017-18, slowing from 6.6% in the preceding fiscal year, according to the first advance estimates of national income for 2017-18, released by the CSO<\/li>\n<\/ul>\n<p>Within this,<\/p>\n<ul>\n<li>The GVA growth rate for \u2018<strong>agriculture, forestry and fishing\u2019<\/strong> is expected to slow sharply to 2.1%, compared with the previous year\u2019s 4.9% pace<\/li>\n<li><strong>Manufacturing sector<\/strong> growth has been forecast at 4.6% in 2017-18, compared with the 7.9% expansion provisionally estimated for 2016-17<\/li>\n<li><strong>Quarrying &amp; Mining<\/strong>: The CSO\u2019s estimates project the mining and quarrying, and construction sectors to grow faster in 2017-18 than they did in the previous year. While mining and quarrying is estimated to expand by 2.9%, compared with 1.8% growth in 2016-17, the construction sector is expected to grow by 3.6%, versus1.7% in the prior period<\/li>\n<\/ul>\n<p><strong>Double digit growth<\/strong><\/p>\n<ul>\n<li>The core sector data for November, the latest release so far, showed the steel and cement sectors registering strong double-digit growth<\/li>\n<\/ul>\n<p><strong>Base effect in agriculture<\/strong><\/p>\n<p>In agriculture, what we are seeing is a base effect because last year saw a very high growth rate because it followed two years of drought. In terms of production, the total production would probably be the second highest in a very long time. It is not unusual growth in agriculture in a good year<\/p>\n<p><strong>RBI\u2019s forecast<\/strong><\/p>\n<ul>\n<li>The CSO\u2019s GVA full-year growth estimate of 6.1%, compares with a 6.7% pace that the Reserve Bank of India had forecast at its December policy meeting<\/li>\n<li>The central bank had at the time flagged rising oil prices and \u201cshortfalls in kharif production and Rabi sowing\u201d as posing downside risks to the outlook for GVA growth<\/li>\n<\/ul>\n<p><strong>Impact on fiscal deficit<\/strong><\/p>\n<p>For this year, the nominal growth is expected to be far lower than what was estimated in the Budget, so the fiscal deficit number will have to be adjusted if the 3.2% of GDP target is to be maintained. And, for next year, the base is now lower, so that year\u2019s fiscal deficit figure will also have to be adjusted<\/p>\n<p><strong>More robust GDP in 2018-19<\/strong><\/p>\n<p>Economic activity has been picking up over the last three quarters and can be expected to strengthen in the coming period with the manufacturing PMI [Purchasing Managers\u2019 Index] now reading at a five-year high of 54, and FMCG demand picking up briskly,\u201d Vice Chairman of NITI Aayog Rajiv Kumar said in a written statement. \u201cHence, the GDP growth will become more robust in 2018-19<\/p>\n<p><strong>Gross Fixed Capital Formation<\/strong><\/p>\n<p>Gross fixed capital formation \u2014 a key investment metric \u2014 is expected to accelerate to 4.5%, from 2.4% in 2016-17<\/p>\n<p><strong>Growth rates of various sectors<\/strong><\/p>\n<ul>\n<li>Growth in the <strong>trade, hotels, transport and communication and services related to broadcasting <\/strong>is estimated at 8.7%, quickening from 7.8% in the previous year<\/li>\n<li>Similarly, the <strong>financial, insurance, real estate and professional services sector<\/strong> is estimated to expand faster at 7.3% in 2017-18, from 2016-17\u2019s 5.7% pace<\/li>\n<li>However, the <strong>public administration and defence and other services category<\/strong> is expected to grow at 9.4% in 2017-18 compared with 11.3% in 2016-17<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>GDP growth seen slowing to 4 year low of 6.5% in 2017-18 Context The Central Statistics Office (CSO)\u2019s GDP forecast What has happened? CSO has forecast that GDP growth in the current financial year ending March 31 will slow to a four-year low of 6.5%, from the provisional 7.1% pace seen in 2016-17, dragged down&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/gdp-growth-seen-slowing-to-4-year-low-of-6-5-in-2017-18\/\">Continue reading <span class=\"screen-reader-text\">GDP growth seen slowing to 4 year low of 6.5% in 2017-18<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[555],"tags":[],"class_list":["post-32265","post","type-post","status-publish","format-standard","hentry","category-test-1","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704900178},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/32265","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=32265"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/32265\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=32265"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=32265"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=32265"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}