New Delhi: India remained the fastest growing major economy with its GDP accelerating to 7.3 per cent in the September quarter, pushed mainly by farm output, although the momentum may be hit in the coming months by the impact of demonetisation.
The Gross Domestic Product (GDP) or national income which rose from 7.1 per cent in the previous quarter is however lower than 7.6 per cent recorded in the same period last year.
India overtook China in economic growth rate in 2015, and continues to be the world’s fastest growing large economy.
Meanwhile, monthly macro-economic data on performance of eight infrastructure sectors showed six-month high growth of 6.6 per cent in October.
According to the data released today by the Central Statistics Office (CSO), the Gross Value Added (GVA), which is estimated at the basic price, growth decelerated to 7.1 per cent as compared 7.3 per cent both in the previous as well as the year ago period.
The data revealed that over 7 per cent growth was recored by ‘public administration, defence and other services’, ‘financial, insurance, real estate and professional services’, ‘manufacturing’ and ‘trade, hotels and transport and communication and services related to broadcasting’.
Growth rates in agriculture, forestry and fishing; mining and quarrying; electricity, gas, water supply and other utility services; and construction were at 3.3 per cent, (-)1.5 per cent, 3.5 per cent and 3.5 per cent respectively. This compares with 2 per cent, 5 per cent, 7.5 per cent and 0.8 per cent year ago period.
Manufacturing slowed to 7.1 per cent from 9.2 per cent in the year-ago period.
On the impact of demonetisation of old Rs 500/1000 notes on growth prospects, Chief Statistician T C A Anant said statements made by experts on the adverse impact of demonetisation is made without any data.
“People make assumptions and based on that they make statements. Once the data comes in, I will make a statement,” he said at a press conference.
Chief Economic Adviser Arvind Subramanian said: “What we have for first half are actual numbers. It shows good consistent performance. For second half we will have to see, there are a lot of uncertainty. We have to analyse it before we say something”.
What is worrying however is the decline in Gross Fixed Capital Formation (GFCF) an indicator of investment.
GFCF growth rates at current and constant prices are estimated at (-)3.2 per cent and (-)5.6 per cent during Q2 of 2016-17 as compared to 7.5 per cent and 9.7 per cent during Q2 of 2015-16.