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India's GDP growth slows to 5.8% in Q4: Experts discuss

Updated : May 31, 2019 08:31 PM IST

India's gross domestic product (GDP) growth rate in the January-March quarter of 2018-19 slowed to 5.8 percent, due to poor performance in the agriculture and manufacturing sectors, as per the data released by the government on Friday.

In an interview to CNBC-TV18, Soumya Kanti Ghosh, group CEA of SBI; Upasna Bhardwaj, senior economist at Kotak Mahindra Bank; DK Joshi, chief economist at CRISIL and Amit Basole, faculty at Azim Premji University, shared their views on India's Q4 GDP numbers.

Ghosh said, "One figure which we calculated shows that there is a significant demand slowdown. The core GVA number has actually slipped to 6.1 percent for Q4 which is down from 7.1 percent in Q3. That means there is significant demand destruction and this is the lowest level from Q2 of FY18."

Bhardwaj said, "Our expectation was 6 percent GDP and this is even lower than what we were expecting. So, this is very disappointing. It is the manufacturing which seems to be dragging more than what we were anticipating. Unfortunately, going ahead too, we are not seeing any signs of stability, forget about recovery as of now. Most of the indicators running into April also have not been showing any promising trends. So, this really doesn't board to well."

Joshi said, "The slowdown was expected but 5.8 percent is a little sharper than what we expected. This is the second consecutive year of the slowdown. I think going ahead the high-frequency data does point out that the pain is continuing into Q1. The only good news is that the IMD had predicted a normal monsoon with the distribution being reasonably good in the sense that north and north-west parts are likely to get good rainfall, so that will keep agriculture good this year. However, the key problem is to revive manufacturing and still in some segments particularly auto segment the pain is still visible."
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