No longer fastest-growing economy |
India lost its fastest-growing major economy tag in the fourth quarter of 2016-17, with GDP growth coming in at 6.1% compared with China`s 6.9% in the same period. Data from the Ministry of Statistics showed GDP grew 7.1% in the financial year 2016-17, slower than the 8% registered in 2015-16. The GDP numbers were based on the new 2011-12 base year recently adopted for data including the Index of Industrial Production (IIP) and Wholesale Price Index (WPI). Gross value added (GVA) growth was 6.6% for 2016-17 and 5.6% in the fourth quarter, compared with 7.9% in 2015-16 and 8.7% in Q4 of that year. That is, post-demonetisation there has been a slowdown. The GDP growth rate is slightly higher (than GVA growth) because of a more than proportionate increase in indirect tax net of subsidies. But the GDP also shows a reduction in Q3 and Q4 numbers compared with the beginning of the year. So demonetisation has clearly had a tangible and adverse impact.” The Centre, however, maintained that it was happy with the growth rate, with Chief Statistician T.C.A. Anant saying that the economy was growing “reasonably well.” India can take some measure of satisfaction, but the numbers do reveal there are areas that still could improve. One of the areas is capital formation. It continues to be relatively soft, with growth still below 30%.
|
|
|
|