India’s GDP growth likely to fall to 11-year low of 5% in FY20: NSO

The National Statistical Office (NSO), under Ministry of Statistics and Programme Implementation, in its First Advance Estimates of National Income, 2019-20, has stated that India's Gross Domestic Product (GDP) growth is expected to fall to an 11-year low of 5% in the current fiscal year (FY20), as compared to the growth rate of 6.8% in 2018-19, mainly due to poor showing by manufacturing and construction sectors. According to back series GDP data released by the government in November 2018, the previous low in economic growth was recorded at 3.1% in 2008-09. Recently, the Reserve Bank of India (RBI) had also lowered its forecast for the economic growth to 5% while announcing its bi-monthly monetary policy.

As per the data, real GDP or GDP at Constant Prices (2011-12) in the year 2019-20 is likely to attain a level of Rs 147.79 lakh crore, as against the Provisional Estimate of GDP for the year 2018-19 of Rs 140.78 lakh crore, released on May 31, 2019. Real GVA, i.e, GVA at Basic Constant Prices (2011-12) is estimated to increase from Rs 129.07 lakh crore in 2018-19 to Rs 135.40 lakh crore in 2019-20. Estimated growth of real GVA in 2019-20 is 4.9% as against 6.6% in 2018-19.

Among the sectors, deceleration in growth will also be witnessed in other key segments, like agriculture; electricity; gas and water supply; trade; hotel and transport sector; financial; real estate; and professional services. Whereas, some sectors, including mining, public administration, and defence, showed minor improvement. The manufacturing sector output growth will decelerate to 2% in 2019-20, down from 6.9% in the previous financial year. Likewise, the construction sector growth is estimated at 3.2% as against 8.7% in 2018-19.

Besides, the GVA at basic prices for 2019-20 from agriculture, forestry and fishing sector is estimated to grow by 2.8% as compared to 2.9% in 2018-19. As regards, mining and quarrying sector, the GVA at basic prices for 2019-20 is estimated to grow at 1.5% as compared to 1.3% in 2018-19. GVA at Basic Prices for 2019-20 from ‘Electricity, Gas, Water Supply and Other Utility Services’ sector is expected to grow by 5.4% as compared to growth of 7.0% in 2018-19. The estimated growth in GVA for the Trade, Hotels, Transport and Communication and Services related to Broadcasting services during 2019-20 is placed at 5.9% as against growth of 6.9%in the previous year.

The Per Capita Net National Income during 2019-20 is estimated to be Rs 1,35,050 showing a rise of 6.8% as compared to Rs 1,26,406 during 2018-19 with the growth rate of 10.0%. Gross Fixed Capital Formation (GFCF) at Current Prices is estimated at Rs 57.42 lakh crore in 2019-20 as against Rs 55.70 lakh crore in 2018-19. At Constant (2011-12) Prices, the GFCF is estimated at Rs 45.93 lakh crore in 2019-20 as against Rs 45.48 lakh crore in 2018-19. Government Final Consumption Expenditure (GFCE) at Current Prices is estimated at Rs 24.34 lakh crore in 2019-20 as against Rs 21.35 lakh crore in 2018-19. At Constant (2011-12) Prices, the GFCE is estimated at Rs 16.65 lakh crore in 2019-20 as against Rs 15.06 lakh crore in 2018-19.