India’s GDP Growth Slips To 5.8% In The Fourth Quarter, Loses Its Title Of Fastest Growing Economy To China

The Logical Indian Crew India

June 2nd, 2019 / 10:04 AM

Image Credit: India TV News

According to government data released on Friday ( 31 May), the Indian economy has grown at its slowest pace since 2014-15. India’s Gross Domestic Product (GDP) slips to 5.8% in the quarter that ended March 2019 from 6.6% in the previous (October-December) quarter. The data also showed that the economic growth rate for FY’19 came in at a five-year low of 6.8%, on the back of a consumption and investment slowdown, reports Business Today.

Subhash Chandra Garg, the Economic Affairs Secretary while addressing a press conference on Friday said, “Slowdown in the fourth quarter GDP was due to temporary factors like the stress in the NBFC (non-banking financial company) sector affecting consumption finance. The first quarter of the current fiscal would also witness relatively slow growth and from the second quarter onwards, the growth and consumption would pick up.”

It signifies that India is no longer the world’s fastest growing economy and has surrendered its title to China which grew at 6.4% in the same period. And it will be a huge challenge for India’s new finance minister, Nirmala Sitharaman (who took charge of the economy just hours before the data was released) to reverse the slump. As per a report by CNN, Shilan Shah, Indian economist at Capital Economics, wrote in a note that Nirmala Sitharaman faces a delicate balancing act to jump-start India’s economy. “She is likely to come under growing pressure to loosen policy to support the economy amid signs that growth has slowed,” she added.


Decline In Consumer Demand

The Hindu reports that the economy’s slow pace was led by sluggish growth in the agriculture, forestry and fishing sector (2.9% growth), the mining sector (1.3% growth) and manufacturing (6.9%). Over the past 15 years, India’s economic growth has been driven by domestic consumption. However, the data released in the last few months show a decline in consumer demand.

According to BBC, the Sales of cars and SUVs have slumped to a seven-year low. Tractor, motorbike, and scooter sales are down. Demand for bank credit has faltered. Growth in fast moving consumer goods (FMCG) have considerably declined in the recent quarters. 


Increasing Unemployment

Another data released a day after the Prime Minister Narendra Modi took oath for the second term, revealed that India’s unemployment rate stood at 6.1% of the total labour force during 2017-18, the highest in 45 years. According to the data, 7.8% of the employable urban youth and 5.3% of employable rural youth was without jobs. In addition to that, 6.2% male and 5.7% females in the country were jobless. The data also showed that the unemployment rate for males was higher in rural areas at 5.8% as against 3.8% for women, while in urban areas the rate for women was 10.8 against 7.1% for men, reports The Hindu.


Also Read: 38% Of The Companies Used In India’s GDP Calculations ‘Not Found’ Or ‘Surveyed’: NSSO Study


Contributors

Written by : Jasmine Kaur (Intern)

Edited by : Bharat Nayak

Related Stories

China Puts Technical Hold

China Blocks India’s Fourth Attempt To Brand Masood Azhar A Global Terrorist; Know All About It

Fastest Growing City India

17 Of Top 20 Fastest Growing Cities Will Be From India, Reveals Study

Delhi Ranked 6th Fastest Growing Metro

Delhi Ranked 6th In The List Of Fastest Growing, Best Performing Metro Cities In The World: Study

India GDP First Quarter 2018-2019 8.2%

India’s GDP Growth In First Quarter 2018-19 Reaches 8.2%, Highest In The Last Two Fiscal Years

India GDP

India Becomes World’s Sixth-Largest Economy In Terms Of GDP: Know What It Means

From License To Bank Of China To Taiwan’s Name Change By Air India: What Changed B/W India & China?

Latest on The Logical Indian

News

Sex Ratio At Birth Drops To 896 During 2015-17, Nearly 1.1 Crore Girls Have Gone Missing In India

News

Himachal Pradesh: 13 Army Personnel Killed, 28 Injured After Building Collapsed Due To Heavy Rain

News

Pakistan Opens Its Airspace After 140 Days Of Balakot Strike; Indian Flights Start Using The Closed Air Routes

News

Senior Lawyer And Rajya Sabha Member KTS Tulsi Introduces Bill For Gender Neutral Rape Law

News

Bihar Floods: 44 Lives Lost And 70 Lakh Affected

Fact Check

Fact Check: No, Drinking Cold Drinks Are Not Mixed With Ebola Virus-Infected Blood

x

Stories that deserve attention, delivered to your inbox!

Handpicked, newsworthy stories which deserve the attention of a rational generation.