SME Times News Bureau | 28 Feb, 2020
Slowdown continued to hamper India's economic activity as 2019-20 third
quarter GDP growth rate was recorded at 4.7 per cent from the revised estimate
of 5.1 per cent reported for the previous quarter.
India's GDP growth during 2019-20 has been estimated at 5 per cent as against
6.1 per cent in 2018-19.
On Friday, the data furnished by the National Statistical Office (NSO) in the
'Second Advance Estimates of National Income, 2019-20' as well as 'Quarterly
Estimates of GDP for Q3, 2019-20' showed revised growth figures for earlier
periods.
As per the data, the revised second quarter GDP growth rate stood at 5.1 per
cent from the earlier 4.5 per cent.
Other revisions include the year-on-year growth rate of 5.6 per cent in Q3
2018-19 from an earlier estimate of 6.6 per cent.
The 4.7 per cent growth would be the slowest rate of expansion in around last
six years.
On a sequential basis, the growth rate came at 7.1 per cent in Q1 of 2018-19,
followed by 6.2 per cent in Q2 in the same fiscal and 5.6 in Q3 FY19. In
2019-20, the revised figures showed that growth stood at 5.6 per cent in Q1,
5.1 per cent in Q2, and 4.7 per cent in Q3.
"Real GDP or Gross Domestic Product (GDP) at Constant (2011-12) Prices in
the year 2019-20 is estimated to attain a level of Rs 146.84 lakh crore, as
against the 'First Revised Estimate of GDP' for the year 2018-19 of Rs 139.81
lakh crore, released on 31st January 2020," the NSO said.
"GDP at Constant (2011-12) Prices in Q3 of 2019-20 is estimated at Rs
36.65 lakh crore, as against Rs 35 lakh crore in Q3 of 2018-19, showing a
growth of 4.7 per cent," it added.
Furthermore, the NSO data showed that Gross Value Added (GVA) growth rate
during the third quarter of 2019-20 on a YoY basis fell to 4.5 per cent from
4.8 per cent in Q2 and 5.6 per cent during the like period of the previous fiscal.
The GVA includes taxes, but excludes subsidies.
"The 'Per Capita Income' in real terms (at 2011-12 prices) during 2019-20
is estimated to attain a level of Rs 95,706 as compared to Rs 92,085 in the
year 2018-19, giving a growth of 3.9 per cent during 2019-20, as against 4.8
per cent in the previous year.
"The 'Per Capita Income at current prices during 2019-20' is estimated to
be Rs 134,432, showing a rise of 6.3 per cent as compared to Rs 1,26,521 during
2018-19," the NSO said.
Moreover, the data showed a sharp contraction of 5.2 per cent in the gross
fixed capital formation in Q3 FY20.
On sector-specific basis, agro and allied, public administration and mining
industries showed healthy performance, whereas manufacturing, electricity and
construction related sectors continued to exhibit contraction.
"Contrary to our expectations that the GDP growth had bottomed out in Q2
FY2020, the initial growth print of 4.7 per cent for Q3 FY2020 reveals that the
slowdown continued in the just-concluded quarter, relative to the upwardly
revised growth for Q1 FY20 and Q2 FY20," said Aditi Nayar, Principal
Economist at ICRA.
According to M. Govinda Rao, Chief Economic Advisor, Brickwork Ratings:
"With the government spending likely to be constrained in the fourth
quarter due to constraints on fiscal space and in the absence of strong green
shoots, we don't expect much improvement in the fourth quarter of
2019-20."
Karan Mehrishi, Lead Economist at Acuite Ratings & Research, said: "Q3
print is in line with our expectations. Even though a favourable base did play
a role in the slight improvement in quarterly value added, it is heartening to
see green shoots in household consumption and capital formation.
"Nevertheless, a tight fiscal space is constricting public expenditure,
which has reported a lower contribution of GDP this quarter."