INSUBCONTINENT EXCLUSIVE:
Friday's GDP data marks the first quarterly report of FY19.GDP or gross domestic product grew 8.2 per cent in the April-June period,
government data showed on Friday
That marked the highest level of economic growth recorded since the January-March period in 2016, and cemented India's position as the
fastest growing major economy ahead of China's 6.7 per cent
Strong performance in manufacturing and consumer spending contributed to the overall figure of 8.2 per cent
Friday's GDP data marks the first quarterly report of the current financial year which began on April 1, 2018
The median consensus in a poll of 50 economists by news agency Reuters had put annual GDP growth at 7.6 per cent in Q1.The Central
Statistics Office (CSO) said in its statement that areas such as manufacturing, electricity and gas registered growth of over 7 per cent
during the period."We are the fastest growing economy Our economy is back on the track," Economic Affairs Secretary Subhash Chandra Garg
He also expressed hope growth could exceed estimates of 7.5 per cent this fiscal year."The GDP growth rateindicates clearly that several
structural reforms introduced such as GST have started giving rich dividends," Finance Secretary Hasmukh Adhia said.In GVA (gross value
added) terms, the GDP growth stood 8 per cent.Economists welcomed the robust quarterly economic growth figures
"This is probably the best GDP trend we have seen in the first half helped by a favourable base
Going ahead, I expect the growth rate to be moderate as private investment is unlikely to grow at a faster rate due to stressed assets,"
said Shashank Mendiratta, India economist, ANZ Bank."Strong acceleration in value addition was led by the farm sector and double-digit
growth in the manufacturing sector
The performance of industry and agriculture have encouragingly improved," said B Prasanna, group executive and head-global markets group,
ICICI Bank.Stock markets edged lower on Friday, ahead of release of the GDP data
BSE benchmark index Sensex fell 45 points to close at 38,645."While the recent fall in the rupee is likely to provide some support to
exporters, rising global protectionism and slower global growth might limit the pickup in exports this year
Therefore, the major support to growth needs to come from a sustainable recovery in private consumption and investment," CARE Ratings said
in a note ahead of release of GDP growth data release.The rupee on Friday plunged to hit and close at 71 against the US dollar for the first
Weakness in the dollar augurs well for exporters
Rupee depreciation combined with a widening current account deficit is likely to increase the borrowing costs of corporate, say
analysts.Trade deficit widened to a more than five-year high of $18.02 billion in July, driven largely by a surge in oil imports
Though merchandise exports rose 14.32 per cent year-on-year in July, the trade deficit widened as oil imports surged 57.41 per cent to
$12.35 billion."Trade disruption so far hasn't played against us
Exports have grown at rate higher than the global rate, imports have also grown," Mr Garg further said.A higher trade deficit leads to
widening of current account deficit - which is the difference between inflow and outflow of foreign exchange - on an annual basis.The
Reserve Bank of India (RBI) had earlier this month retained its GDP growth projection for 2018-19 at 7.4 per cent, citing "evenly balanced"
In financial year 2017-18, GDP expanded at 6.7 per cent, lower than the 7.1 per cent recorded in the previous year.(With agency inputs)
