NEW DELHI: After registering a growth of 7.7 per cent in the January-March quarter of 2017-18 fiscal, the Union government expressed confidence about a 7.5 per cent growth in the economy this financial year, a day after rating agency Moody’s cut India’s growth forecast to 7.3 per cent on account of high oil prices.
According to data released by the Central Statistics Office (CSO), India’s Gross Domestic Product (GDP) growth in the fourth quarter of FY18 was at a seven-quarter high of 7.7 per cent, helping the country retain the tag of world’s fastest growing major economy.
For the year, the Indian economy grew at four-year low of 6.7 per cent in FY18, down from 7.1 per cent in the previous fiscal. Fiscal deficit for FY18 worked out to be 3.53 per cent of the GDP, broadly in line with the government’s revised estimates, while the revenue deficit was 2.65 per cent of GDP.
“I don’t think we are revising our forecast for the current year 2018-19, which was indicated at 7.5 per cent. We retain it at this moment at this level. There has been some downward revision by Moody’s and others taking oil prices into consideration, but there is no one-to-one relation between oil prices and GDP growth,” Subhash Chandra Garg, Secretary, Department of Economic affairs, told reporters.
On Wednesday, Moody’s cut India’s 2018 growth forecast to 7.3 per cent from the previous estimate of 7.5 per cent, saying higher oil prices and tighter financial conditions will weigh on the pace of acceleration.
As per the CSO data, manufacturing sector GVA grew at 9.1 per cent in Q4FY18, up from 6.1 per cent in FY17. Similarly, construction sector grew at 11.5 per cent in the same quarter, against a contraction of 3.9 per cent a year ago.
Garg said agriculture sector has witnessed growth, while manufacturing and construction data indicate a “turnaround in the economy which, going forward, will give a good momentum to growth”.
“GDP growth has been increasing continuously every quarter with growth of 7.7% in Q4 of 2017-18. Shows the economy is on the right track & set for even higher growth in the future. This is the #SahiVikas under leadership of PM,” Union Minister Piyush Goyal tweeted.
According to Finance Secretary Hasmukh Adhia, the boost was due to the implementation of GST. “We would like to believe that GST has given a big boost to the Industrial Sector,” tweeted Adhia.