CHENNAI: Contrary to projections by analysts and economists, demonetisation has not dented India’s economic growth, data released by the Central Statistics Office (CSO) on Tuesday show.
According to CSO, India’s GDP growth during the third quarter of the current financial year will be seven per cent, which will help the country retain the tag of the fastest growing major economy. In comparison, China had recorded a GDP growth of 6.8 per cent for the same period.
Government spokespersons said the CSO figures prove that demonetisation has not had as big an impact on India’s economy as predicted. “All the negative projections about the fallout of demonetisation have been highly over-estimated, because growth continues to remain at seven per cent and more,” said Economic Affairs Secretary Shaktikanta Das on Tuesday.
A Reuters poll of analysts released last week had estimated the number would stand at 6.4 per cent. While GDP growth for the quarter was not as slow as estimated, it decelerated from the 7.4 per cent recorded during the July-September quarter.
According to CSO data, the GDP growth for the entire financial year would be 7.1 per cent, down from 7.9 per cent estimated for 2015-16.
“Real GDP in 2016-17 is likely to attain a level of Rs 121.65 lakh crore, against the first revised estimate of GDP for 2015-16 of Rs 113.58 lakh crore, released on January 31, 2017. The growth in GDP during 2016-17 is estimated at 7.1 per cent compared to the growth rate of 7.9 per cent in 2015-16,” said the CSO in its statement.
The growth in electricity, gas, water supply and other utility services is estimated to be 6.6 per cent. However, some experts were skeptical.
“This may not have factored in the entire short-term impact of demonetisation. The impacts are likely to be more visible in the Q4 with the lag effects of November and December becoming more pronounced,” Ranen Banerjee, leader — public finance and economics at PwC India told Express.