Govt calls ‘disappointing’ GDP growth rate in Q2

Govt calls ‘disappointing’ GDP growth rate in Q2

Agency News

New Delhi, Nov 30 : The Government on Friday called “disappointing” the GDP growth, recorded at 7.1 per cent in the second quarter of this year.

The Centre, however, said the growth stood at 7.4 per cent in the first half year which was quite robust and healthy.

Department of economic Affairs Secretary S C Garg tweeted, “GDP growth for second quarter 2018-19 at 7.1% seems disappointing. Manufacturing growth at 7.4% and agriculture growth at 3.8% is steady. Construction at 6.8% and mining at -2.4% reflect monsoon months deceleration. Half year growth at 7.4% is still quite robust and healthy.”

The Finance Ministry said the second quarter has seen a reasonable overall GDP growth of 7.1 per cent. The first half of 2018-19 growth of the GDP is 7.6 per cent and the first half GVA growth is 7.4 per cent. The growth in the second quarter is on higher base compared to the growth of the first quarter.

The Ministry said the manufacturing growth on a base of 7.1 per cent in Q2 2017-18 has been 7.4 per cent in Q2 2018-19. The construction sector has grown by 7.8 per cent. The Gross Fixed Capital Formation as a ratio of GDP has increased by almost 1.3 percentage points over Q2 of last year.

The exports for Q-2 have grown by 13.4 per cent. The Government consumption for the quarter has also significantly increased by 12.7 per cent. This quarter also faced the challenge of higher oil prices resulting in much higher import bill and the weakening of the rupee.

“The Indian Economy is on track to maintain a high growth rate in the current global environment,” the Ministry concluded.

Welcoming this development, Dr Bibek Debroy, Chairman of the Economic Advisory Council to Prime Minister attributed this positive trend to government’s successful policy efforts in maintaining a stable domestic environment despite global uncertainties.

He further stated that the government’s focus on simplifying India’s business and investment eco-system, complimented by its initiatives to make growth more equitable and inclusive has greatly improved India’s economic health in the recent past.

He added that despite international trade tensions and volatile crude oil prices, India’s strong economic fundamentals continue to provide the much-needed thrust for it to be a major global driver of economic growth. The robust growth rates in sectors such as manufacturing and construction show that the growth momentum continues to be broad based.

The encouraging growth figures along with continued empowerment of the economically disadvantaged through programs such as last mile electricity connectivity and housing for all, are positive signs for India’s economic prospects in the coming quarters.

The second quarter data for the GDP growth for the financial year 2018-19 was released where the GDP slipped down to 7.1 per cent. (UNI)