GDP growth rate to be slower in FY17 at 7.1%

Note ban
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Economy of India will grow at a slower pace at 7.1% in the coming financial year as against 7.6% of last year. According to Govt data, this is mainly due to poor showing of manufacturing, mining and construction, also; effect of demonetization is not taken into consideration.

Some economists and experts have been repeatedly talking about the adverse effects of Note ban to the economy in the near future and also in upcoming year.

According to the sources, chief statistician C A Anant told in a report about demonetization, “We don’t need to speculate. It (the estimates) is on actual outcome based data. We have not taken bank deposits and credit data for the month of November due to volatility because of major policy change.”

He also said that CSO ( Central Statistics Office ) has factored in all latest data available so far while arriving at a conclusion that the economic growth will be 7.1% this year. And also, current data and estimated figures are based on the indicators available as of now.

Talking more about the slow growth rate, he said that the main reason for slow GDP growth rate is mainly because of the poor performance of index of Industry production.

Former Prime Minister, Manmohan Singh has also predicted growth rate to fall by 2 percent due to the Note ban, taken place on November 8. Few economists have also projected slow growth rate in the near future.

In the event, Economic Affairs Secretary Shaktikanta Das said, “Being a statistical organisation, CSO has to go on real statistics and we cannot expect them to go on the basis of impressions and anecdotal evidence. The economic survey and the budget will spell our what approach the government will take, so I would not like to pre-judge and I cannot comment on that, but as I mentioned earlier,” he said,

Accordingly, the ‘First Advance Estimates of National Income, 2016-17’ did not reflect the impact of demonetization,  and are based on sector data for only seven months or till October 2016.

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