NEW DELHI: On a day the new finance minister, Nirmala Sitharaman, took charge, there was worry on the economic front as data showed India’s GDP growth slowed down to a 5-year low.
With reduced consumer spending, private investment and government expenditure, GDP growth fell faster than expected to 6.8% in FY19 — a five-year low — while the fourth quarter grew by an anaemic 5.8% compared with the 8% GDP growth in the April-June 2018 quarter.
“A consumption slowdown, coupled with a liquidity crisis and low savings rate which translates into lower investment has led to a sub-7% GDP growth rate,” said M Govinda Rao, former Member of the Prime Minister’s Economic Council.
The low growth rate will mean the new finance minister will have her hands full at trying to revive growth while curbing fiscal profligacy.
Given the downturn, RBI could cut repo rate by 25 bps basis in the next monetary policy review. RBI had cut repo rate by 25 bps each in its February and April policy reviews.
Parl session from June 17, budget on July 5
The first session of the 17th Lok Sabha will be held from June 17 to July 26, with the regular Budget to be presented on July 5, Union Minister Prakash Javadekar said on Friday.
The economic survey will be tabled on July 4 followed by the presentation of the budget the next day.
It will be the first budget of the Modi government in its second term and will be presented by Finance Minister Nirmala Sitharaman