Bikky Khosla | 04 Dec, 2018
growth for the second quarter of 2018-19 fell to 7.1% from 8.2% in the previous
quarter. While this growth is higher than the 6.3% rate registered during the
corresponding quarter of last year and also faster than that of China during
the same period, it is still the lowest in last three quarters. The Centre has
blamed a higher base effect and higher crude prices for this. PM's Economic
Advisory Council Chairman Bibek Debroy saw a positive trend in these figures.
But a top government official termed it as disappointing.
people have differing reactions to the same set of data. Interestingly, the
latest data came amid the ongoing controversy over Modi government’s recent
revising down of UPA era GDP growth rates for the 2006-2012 period to 6.9% from
8.2% per year, based on the back series of GDP adopted by the Central
Statistical Office in 2015. This revision junked the narrative by many popular
accounts that India had recorded unprecedented economic growth during these
years. Besides the political rivals of the government, many independent experts
have raised questions about this revision.
the second quarter GDP data shows that the manufacturing sector expanded 7.4%
following 13.5% surge in the previous quarter. This decline, though on expected
lines of some analysts, deserves attention of the government. The agriculture
sector which grew 3.8% from 5.3% in the previous quarter also needs to be taken
care off. On the overall growth rate, it should not be forgotten that though it
looks somewhat respectable, India needs to grow 8%-plus to generate enough jobs
for its ever expanding young labour force. Our politicians, instead of playing
politics over GDP data, should focus on growth deliverables.
also saw release of two more key data sets. First, output growth of the eight
core industries accelerated in October to 4.8% from 4.3% in September. This
mild growth was led by a healthy uptick in cement, coal and electricity.
Second, the Nikkei India Manufacturing index showed that factory output in
November rose to an 11-month high. Experts attributed this growth to stronger
demand conditions and greater sales. These are positive developments.