India No Longer World’s fastest Growing Economy | Burning Issues | PDF Download

WHAT JUST HAPPENED?

• India’s economy grew at a much-lower-thanexpected rate of 5.8 per cent in January-March quarter, its lowest level in five years, as per data released by the Central Statistics Office (CSO)

The Central Statistics Office (CSO) is a governmental agency in India under the Ministry of Statistics and Programme Implementation

LOST THE CROWN

• The fourth quarter growth pushes India below China’s which grew at 6.4 per cent during January-March period. Most economists had projected GDP growth of 6.3 per cent in January-March. Growth rate has been steadily falling in 2018-19, from 8 per cent in Q1 to 7 per cent in Q2, 6.6% in Q3 and 5.8% in Q4.

INDIA LOSES ITS LUSTER

YEAR ON YEAR COMPARISON

• Similarly, the full fiscal 2018-19 was no better for the economy with the country recording a GDP growth of 6.8 per cent – the lowest in five years. In the fiscal 2017-18, the country had clocked a GDP growth rate of 7.2 per cent. WHY INDIA’S NUMBERS LOW? NBFC Stress Non-Banking Financial Companies NBFCs have been under liquidity pressure after the shock default by Infrastructure Leasing & Financial Services (IL&FS) in September 2018

WHY INDIA’S NUMBERS LOW?

• Unlike China, India’s economic growth has been driven by domestic consumption over the last 15 years and the latest data showed weaker consumer demand. There was also a slower growth in investment, which fell to 3.6% from 10.6% in the previous quarter. Finance secretary Subhash Chandra Garg said that the next quarter – the three months of April to June – could also be “relatively slower”.

INDIAS ARE NOT SPENDING A LOT

• India’s consumers are spending less on everything from toothpaste to automobiles The last six months have seen weak demand and lower sales growth in key sectors such as the fast-moving consumer goods (FMCG) and automobile industries.

‘JOBS CRISIS’

• Indias unemployment rate at 6.1 per cent of the total labour force during 2017-18 is at a 45-year high. The Periodic Labour Force Survey (PLFS) of the National Sample Survey Office (NSSO) Read more at: //economictimes.indiatimes.com/articleshow/69598640.cms? utm_source=contentofinterest&utm_medium=text&utm_ca mpaign=cppst ‘JOBS CRISIS’ Unemployment rate in the country in FY18 was at 5.3% in rural India and 7.8% in urban India, resulting in overall unemployment rate of 6.1%.

BOLD STEPS REQUIRED

• Reforms to India’s onerous land acquisition and labor laws that could unleash manufacturing—have languished after early-term efforts failed to secure lasting support.

 
 

 

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