GDP in FY15 may have grown lower at 7.3% than Central estimate

Rating agency India Ratings and Research today said the country's GDP may have grown at 7.3 per cent in FY 2014-15 which is slightly lower than Centre's estimate of 7.4 per cent.
"We forecast FY15 GDP (at FY12 prices) to be 7.3 per cent as against the advance estimate of 7.4 per cent by the Central Statistics Office (CSO)," the agency said in a report here today.
The net exports, which is the difference between exports and imports in national income accounting, might have turned positive in the last quarter of FY15.
Although net exports for FY15 as a whole will still be negative, it will be lower than the advance estimate thereby contributing positively to the GDP growth, the report said.

The agency expects a 22.5 per cent year-on-year decline in net exports for FY15 as against the CSO advance estimate of a decline of 19.5 per cent.
It said the industrial sector is also likely to miss advance estimates.

"Although IIP (general) grew at its fastest pace in last three fiscals, we expect industrial sector growth to fall short of CSO's advance estimates of 5.9 per cent," the report said.
Ind-Ra expects industrial gross value-added (GVA) growth to come in at 5.8 per cent in the fourth quarter of FY15 and for the full year at 5.4 per cent.
Notwithstanding unseasonal rains in large parts of country in February and March 2015, agriculture may have grown at 1.1 per cent in FY15.

The FY15 advance estimate has pegged private final consumption expenditure (PFCE) growth at 7.1 per cent.
"If PFCE has to match advance estimates, it has to grow at 11.8 per cent in the fourth quarter in FY15, which is a daunting task," the report said.
It said with decline in inflation, households' inflation expectations have also declined sharply and it should have resulted in higher consumption expenditure in the economy but consumers are still cautious and somewhat sceptical about the sustainability of trajectory of inflation decline.