GDP grows at 7.9% in Q4, may record 8% growth this fiscal

Gaining momentum, economy grew by 7.9 per cent in March quarter to consolidate India's position as the fastest growing major economy with a five-year high growth rate of 7.6 per cent for the full fiscal on robust manufacturing growth.
Enthused by the impressive numbers for 2015-16, as against 7.2 per cent in previous fiscal, the government said the growth rate can go up to 8 per cent in the current fiscal on the back of good monsoon.
The farm sector also rebounded to the growth zone, as against a contraction in previous year, although the rate of expansion was low at 1.2 per cent in 2015-16.

The industry lauded the numbers and expressed hope that better monsoon and further reforms will help expand the economy at even a faster pace.
According to the data released by the Central Statistics Office (CSO) today, the growth in manufacturing and farm sectors during the fourth quarter accelerated to 9.3 per cent and 2.3 per cent, respectively.
The core sector data in April too indicated momentum in the economic activity as it grew at rate of 8.5 per cent in the month, the highest in the last four years.

Commenting on GDP numbers, Economic Affairs Secretary Shaktikanta Das said India can move towards 8 per cent growth with better agriculture production.

"The various measures that the government has been taking in the last couple of years is beginning to show results and overall there are greenshoots...This year hopefully with good monsoon we should look at a growth closer to 8 per cent," he said.
Finance Secretary Ashok Lavasa said, "We should work towards seeing this (GDP growth) number grow. We are focusing on capital spending in infra and social spending."
"Growth rate in the 4th quarter of 2015-16 at 7.9% almost hits the magical 8% mark. Good days ahead," NITI Aayog Vice Chairman Arvind Panagariya tweeted.
The CSO has also revised the GDP growth rate for previous quarters of 2015-16 -- 7.5 per cent for April-June, 7.6 per cent for July-September and 7.2 per cent for October-December.

CII Director General Chandrajit Banerjee too said that the
economy would achieve close to 8 per cent growth in 2016-17, "riding on the crest of strong macro-economic fundamentals, positive business sentiment and pro-growth monetary and fiscal policies".
"Growth of 7.6 per cent for the fiscal year 2015-16 is in line with the advance estimates...In the current global economic scenario, this is a commendable performance and comes on the back of comprehensive reform measures undertaken by the government," said FICCI President Harshavardhan Neotia.
As per the CSO data, GDP of the mining and quarrying segment grew by 8.6 per cent in the last quarter of 2015-16 whereas electricity, gas, water supply and other utility services recorded a growth rate of 9.3 per cent.

Similarly, the construction sector grew at 4.5 per cent, trade, hotels, transport and communication at 9.9 per cent, financial, real estate and professional services at 9.1 per cent, and public administration, defence and other services at 6.4 per cent in the fourth quarter of 2015-16.
According to the new concept of Gross Value Added (GVA), farm sector grew at 1.2 per cent in 2015-16 as against contraction of 0.2 per cent in the previous fiscal.
The manufacturing sector accelerated to 9.3 per cent, up from 5.5 per cent in the previous fiscal.
However, the mining and quarrying segment recorded a growth of 7.4 per cent in FY2016, down from 10.8 per cent in the previous fiscal.

According to data, the Gross National Income at current prices was estimated at Rs 134.19 lakh crore in 2015-16, against Rs 123.41 lakh crore during 2014-15, showing a rise of 8.7 per cent.
The per capita income at current prices during 2015-16 is estimated to have attained a level of Rs 93,293 as compared to the first revised estimate for the year 2014-15 of Rs 86,879 showing a rise of 7.4 per cent.
The GDP at current prices for 2015-16 is estimated at Rs 135.76 lakh crore, showing a growth rate of 8.7 per cent over the first revised estimates of GDP for the year 2014-15 of Rs 124.88 lakh crore.

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The manufacturing sector registered 9.1 per cent growth during first quarter of the current fiscal, compared to 7.3 per cent a year ago.
The construction industry is estimated to have grown by 1.5 per cent in first quarter as against 5.6 per cent year ago.
GVA growth in services sector during first quarter is estimated at 9.6 percent as against 8.8 per cent year ago.
GVA growth in trade, hotels, transport, communication and services related to broadcasting sector in first quarter is estimated at 8.1 per cent as against 10 per cent a year ago.
Public administration, defence and other services have grown at 12.3 per cent as against 5.9 per cent a year ago.

According to the statement, the growth in collection of Union Excise duties, custom duties and service tax was 61 per cent, 18 per cent and 29 per cent respectively in the first quarter of this fiscal, as against growth of 104 per cent, 22 percent and 14 per cent respectively a year ago.
It also said that the major subsidies grew by 53 per cent in first quarter of this fiscal as against decline of 26 per cent a year ago.
As regards eight core sectors - coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity - they expanded by 3.2 per cent in July, as against 1.3 per cent in same month last year.

The core sectors, which contributes 38 per cent to the country's total industrial production, recorded a cumulative growth of 4.9 per cent during April-July period of the current fiscal.
Refinery production expanded by 13.7 per cent in July as against 2.9 per cent in the year-ago month.
Coal output expanded by 5.1 per cent. In July 2015, the segment had contracted by 0.1 per cent.
Natural gas production witnessed a growth of 3.3 per cent as against a decline of 4.4 per cent in the same month of the last financial year.
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The finance ministry in a statement said GDP growth has also been helped by improvement in growth of exports of goods and services to 3.2 per cent in Q1 2016-17 from (-) 5.7 per cent in Q1 2015-16 as well as reduction in imports to (-) 5.8 per cent from (-) 2.4 per cent.

GVA growth is higher than the GDP growth because the growth in net indirect taxes declined to 3.6 per cent in the said quarter from 11.9 per cent a year ago, it added.
It further said manufacturing has been "one of the bright spots" on the supply side, with growth increasing to 9.1 per cent (7.3 per cent).
But on account of the slackness in mining and quarrying and construction activity, the overall industrial growth declined to 6 per cent in the June quarter, the ministry added.
As for the services sector, it said the major driver is the substantial increase in growth of public administration, defence and other services to 12.3 per cent (5.9 per cent).
The growth in financial, insurance, real estate and professional services also remained strong, it added.
Going forward, the ministry said, the growth dividends of good monsoon may be reaped in subsequent quarters. The Pay Commission payouts can give boost to consumption as well.
"The impact of various structural reforms taken by the government in the last two years will also have positive impact on growth," it added.