GDP decelerates to three-year low

Click here for enlarge

India's economic growth unexpectedly slid to a three-year low in the last quarter, delivering a blow to Prime Minister Narendra Modi who is facing criticism for disrupting business activity through his shock cash squeeze last year.

Among the sector's that have seen 7 percent or more GVA are "trade, hotels, transport & communication and services related to broadcasting", "public administration, defence and other services" and "electricity, gas, water supply & other utility services".

The growth rate is lower than last year's 7.9 percent expansion in the same quarter as also the previous quarter's 6.1 percent growth indicating the shock and pressure of demonetisation and disruption by destocking activities undertaken by manufacturing firms caused ahead of GST's rollout.

In its mid-year economic survey, the finance ministry last month cited exchange rate appreciation as one of the downside risks for Asia's third-largest economy. He further said that destocking by companies following pre-Goods and Services Tax (GST) jitters and lesser investment by the private sector also resulted in slowdown of Indian Economy. Government spending too slowed. Some sectors like services showed growth.

"We have to revise our GDP outlook numbers for the full year".


The Finance Minister said demonetisation will benefit in the medium and long term even if it hits GDP in two or three quarters, and one more benefit was that the economy will gain due to formalisation of the informal sector. "However, de-stocking has now been completed, and therefore we can expect production to go up", he said. This was way before demonetisation and GST flavored out their affect. A year ago for the same quarter, consumption grew at 8%. "The slowdown reflects sharp deceleration in exports of goods, and some moderation in consumption growth", it said.

"Continuous fall in fixed investments, unsolved problem of banks' NPAs (non-performing assets) in India, global policy and political risks and tightening financial conditions on account of deleveraging financial institutions and slowdown in real estate could weigh negatively", the industry lobby said in a statement. The national income data released by the Central Statistics Office for the first quarter is lowest during the Modiled government's regime, which assumed office in May 2014.

Previously, strong rupee appreciation would prompt policymakers to talk down the currency.

"In China, they are growing by 6.2 percent and our growth rate has now slowed down to 5.7 percent". However, Jaitley is still hopeful of over 7% GDP growth this fiscal year.

Related News:



Most liked

Oxlade-Chamberlain Thanks Wenger And Fans After Liverpool Switch
City remain very keen to sign Sanchez from before Deadline Day ends , though, and will improve on that initial offer. I welcome him to the Liverpool family".

Liverpool might hijack £35m AOX transfer
Algeria says it has given winger Riyad Mahrez permission to leave the national squad to "formalize his transfer to his new club". He denied the charge and has appealed against the sentence, which since it is convertible usually results in community service.

Gasoline prices expected to continue to rise over Labour Day long weekend
On Thursday in NY , the price of a barrel of crude oil for delivery in October rose USA $1.27 at closing, to U.S. $47.23. McTeague said how much the price actually jumped up works out to be closer to nine cents, but the message is the same.

AAP wins #BawanaByPoll, big setback for BJP
Having lost two seats that went to polls in Goa, the Congress today alleged that the ruling BJP "indulged in corrupt practises". The advent of AAP on Delhi's political scene has totally altered the electoral equations in the city-state.

Amazon adds multiroom audio control to Echo devices
Alexa customers will be able to access Cortana's features, including booking meetings, accessing calendars and reading email. Google , of course, has Google Assistant built into the Google Home speaker as well as select Android phones.

Lights, camera, action! The Ball family's reality TV show premieres this fall
Ball managed to score a deal with Facebook back in June that would allow him to produce a reality show called Ball in the Family . LaVar Ball and his three basketball sons continue to be media darlings.

US Open counts second big upset with Naomi Osaka bouncing Angelique Kerber
The young woman from Japan made a real mark here previous year with a third-round run that took out No30 seed Coco Vandeweghe. The next game, Kerber clinched two break points but Osaka hit a backhand victor and a forehand down the line to save both.

Unnamed Xiaomi Smartphone Announced for September 5 Release
One sensor has an aperture of f/2.2 and captures RGB shots, while the other 12MP sensor has a telephoto lens with f/2.6 aperture. Xiaomi India on Monday shared a teaser image about the Xiaomi's next smartphone launch event on its official Twitter account.

Spencer Ware Reportedly Will Miss Time with Knee Injury; LCL, PCL Damaged
Ware was carted off the field after suffering a PCL injury in Friday's preseason game against the Seahawks. Ware will seek a second opinion, per Kissel, but the outlook doesn't look good.

Raikkonen contract came as no surprise to Perez
Lewis Hamilton has secured pole position for the Belgian Grand Prix , equalling Michael Schumacher's record of 68 career poles. Vettel, who had struggled through the build-up sessions, admitted: "I really needed that final lap".

Facebook and Instagram services interrupted, users unable to post or browse
Some users were told the website was undergoing "required maintenance" on Saturday afternoon as they attempted to log in. While some users couldn't upload pictures, like posts, or send messages, others said the website was working fine.

Uber Posts Loss, Bookings Increase
While Uber still lost $645 million, that represents a 14 percent decrease over the $708 million lost in the first quarter. It bent to mounting pressure from drivers in June by adding the option for customers to tip within the app.

Hamilton: Spa Friday practice one of Mercedes' strongest in 2017
Asked if Mercedes had an advantage over Ferrari after Friday's running, he added: "I don't think so". Ferrari are putting their best efforts to retain their star driver for the next three seasons.

Casualties Feared After Attack on Shia Mosque in Kabul
The number of those who died and were injured is not yet clear, though reports have said some guards are confirmed dead. Many explosions were later heard from the area during the clearance operation by the Crisis Response Unit.

Partly sunny, high near 67 — TODAY'S FORECAST
After Wednesday , high temperates are expected to be in the upper-70s for the next week, with nighttime lows in the 50s. Wednesday will be slightly cooler, with a high of 81 degrees and a low of 58 degrees.