Indian GDP growth decelerates to 7% in first quarter

01 Sep 2015 Evaluate

Showing signs of deceleration, gross domestic product (GDP) growth at market prices (at constant prices), in the April-June 2015 quarter saw growth at 7%, lower than the 7.5% notched up during the previous quarter. The expectation was that growth in GDP would be higher than growth in gross value-added (GVA) , simply because indirect taxes have gone up and subsidies have fallen. In the March quarter, GDP growth at constant prices was well above GVA growth. But at constant prices, GVA growth this time was higher than GDP growth.

As per the Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation data, GDP at constant (2011-12) prices in Q1 of 2015-16 is estimated at Rs 27.13 lakh crore, as against Rs 25.35 lakh crore in Q1 of 2014-15, showing a growth rate of 7.0 percent. Quarterly GVA at Basic Price at constant (2011-2012) prices for Q1 of 2015-16 is estimated at Rs 25.80 lakh crore, as against Rs 24.10 lakh crore in Q1 of 2014-15, showing a growth rate of 7.1 per cent over the corresponding quarter of previous year. GDP, which is derived by adding taxes on products net of subsidies on products to GVA at basic prices at current prices in Q1 of 2015-16 is estimated at Rs 32.43 lakh crore, as against Rs 29.80 lakh crore in Q1 of 2014-15, showing a growth rate of 8.8 percent. GVA at Basic Price at current prices in Q1 of 2015-16, is estimated at Rs 30.30 lakh crore, as against Rs 28.28 lakh crore in Q1, 2014-15, showing an increase of 7.1 per cent.

The economic activities which registered growth of over 7 percent in Q1 of 2015-16 over Q1 of 2014-15 are ‘manufacturing’, ‘trade, hotels and transport & communication and services related to broadcasting’ and 'financial, insurance, real estate and professional services'. Industry wise, Quarterly GVA at basic prices for Q1 2015-16 from ‘agriculture, forestry and fishing’ sector grew by 1.9 percent as compared to growth of 2.6 percent in Q1 2014-15. Quarterly GVA from ‘mining and quarrying’ sector grew by 4.0 percent as compared to growth of 4.3 percent in Q1 2014-15. From ‘manufacturing’ sector grew by 7.2 percent as compared to growth of 8.4 percent in Q1 2014-15. From ‘Electricity ,Gas, water supply and other utility services’ sector grew by 3.2 percent as compared to growth of 10.1 percent. From ‘Construction’ sector grew by 6.9 percent as compared to growth of 6.5 percent. From Trade, hotels and Transport & communication and services related to broadcasting Quarterly GVA at basic prices for Q1 2015-16 grew by 12.8 percent as compared to growth of 12.1 percent in Q1 2014-15. From Financial, insurance, real estate and professional services grew by 8.9 percent as compared to growth of 9.3 percent in Q1 2014-15. From Public administration and defence and other services Quarterly GVA at basic prices for Q1 2015-16 from this sector grew by 2.7 percent as compared to growth of 2.8 percent in Q1 2014-15.

On expenditure front, Private Final Consumption Expenditure (PFCE) at current prices is estimated at Rs 19.89 lakh crore in Q1 of 2015-16 as against Rs 18.10 lakh crore in Q1 of 2014-15. At constant (2011-12) prices, the PFCE is estimated at Rs 15.93 lakh crore in Q1 of 2015-16 as against Rs 14.84 lakh crore in Q1 of 2014-15. Government Final Consumption Expenditure (GFCE) at current prices is estimated at Rs 3.86 lakh crore in Q1 of 2015-16 as against Rs 3.71 lakh crore in Q1 of 2014-15. At constant (2011-2012) prices, the GFCE is estimated at Rs 3.10 lakh crore in Q1 of 2015-16 as against Rs 3.06 lakh crore in Q1 of 2014-15.

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Indian GDP growth decelerates to 7% in first quarter

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