NEW DELHI: India’s economic growth is expected to slow to a four-year low of 6.5 per cent in 2017-18 as demonetisation and GDP rollout continue to drag agriculture and manufacturing sectors, the first advance estimates of national income released by the government on Friday showed. This is lower than the 7.1 per cent growth recorded last fiscal. The estimates are arrived at based on economic indicators for first seven or eight months of the financial year.
The growth of real gross value (GVA) added in 2017-18 is anticipated at 6.1 per cent, compared to 6.6 per cent in the previous year. GVA is calculated by the total GDP minus the net taxes, a system which has been introduced by the Central Statistics Office (CSO) to measure the performance of the economy in advance.
First advance estimates
Growth to slacken to 6.5 per cent
Sluggishness due to effects of demonetisation and GDP rollout which hampered agriculture and manufacturing sectors
According to the CSO, GDP growth rate for the first quarter of 2017-18 fell to a three-year low of 5.7 per cent, in what seems to be a direct fallout of demonetisation. Agriculture, manufacturing, mining and construction sectors dragged industrial growth. In the current fiscal, agriculture, forestry and fishing are estimated to grow at 2.1 per cent against 4.9 per cent last year.
The manufacturing sector may grow at 4.6 per cent against 7.9 per cent in 2016-17. Mining & quarrying and construction sectors are estimated to grow at 2.9 per cent and 3.6 per cent, respectively, lower than 7 per cent growth last year.