India’s economic growth slows to 5-quarter low of 6.6% in Q3FY19

In signs of the Indian economy losing steam ahead of the general election, the country’s gross domestic product (GDP) growth slowed to a five-quarter low of 6.6% in October-December period of this fiscal (FY19), as compared to 7% growth in the same quarter of FY18, on the back of lower farm and manufacturing growth and weaker consumer demand. Also, economic growth estimate for FY19 has been revised downwards to 7% from the earlier estimate of 7.2%. This is the lowest growth in the last five years. However, the Q3 growth rate, which was lower than the revised estimate of 7% in the previous quarter and 8% in April-June, was faster than China's 6.4% growth for the three months to December 2018. Thus, India retains its tag of the world's fastest-growing major economy.

The Central Statistics Office, in its second advance estimate said that GDP at Constant (2011-12) Prices in Q3 of 2018-19 is estimated at Rs 35.00 lakh crore, as against Rs 32.85 lakh crore in Q3 of 2017-18, showing a growth rate of 6.6%. GDP growth rates for Q1 and Q2 of 2018-19 at Constant Prices are 8.0% and 7.0% respectively. Gross Value Added (GVA) at Basic Prices at Constant (2011-12) Prices in Q3 of 2018-19 is estimated at Rs 32.31 lakh crore, as against Rs 30.39 lakh crore in Q3 of 2017-18, showing a growth rate of 6.3%.

GDP at Current Prices in the year 2018-19 is likely to attain a level of Rs 190.54 lakh crore, as against Rs 170.95 lakh crore in 2017-18, showing a growth rate of 11.5%. GVA at current Basic Prices in Q3 of 2018-19 is estimated at Rs 43.76 lakh crore, as against Rs 39.65 lakh crore in Q3 of 2017-18, showing a growth of 10.4%.

The data showed that farm sector GVA will grow at 2.7% in 2018-19 compared to 5% a year ago. Mining and quarrying growth for the full fiscal has been estimated at 1.2% as against 5.1% in 2017-18. However, it estimated that manufacturing growth would be higher at 8.1% compared to 5.9% in the previous financial year. The construction sector continued to show signs of an upswing, growing at 9.6% in Q3, up from 8.5% in Q2. The CSO pegged the sector’s full-year growth at 8.9%, up from 5.6% the year before, on the back of infrastructure spending push by the government.

The per capita income in real terms (at 2011-12 Prices) during 2018-19 is likely to attain a level of Rs 92,718 as compared to Rs 87,623 for the year 2017-18. The growth rate in per capita income is estimated at 5.8% during 2018-19, as against 5.7% in the previous year. Private Final Consumption Expenditure (PFCE) at Current Prices is estimated at Rs 113.33 lakh crore in 2018-19 as against Rs 100.83 lakh crore in 2017-18. Government Final Consumption Expenditure (GFCE) at Current Prices is estimated at Rs 21.31 lakh crore in 2018-19 as against Rs 18.86 lakh crore in 2017-18. Gross Fixed Capital Formation (GFCF) at Current Prices is estimated at Rs 55.02 lakh crore in 2018-19 as against Rs 48.97 lakh crore in 2017-18.