New Delhi: India's economic growth dropped to a six-year low of 5% in the April-June quarter of 2019-20 due to a sharp deceleration in the manufacturing sector and sluggish agriculture output, according to official data released on Friday.
The previous low was recorded at 4.9% in April-June 2012-13. The economic growth was 8% in the same quarter of 2018-19.
The gross value added (GVA) growth in the manufacturing sector tumbled to 0.6% in the first quarter of this fiscal from 12.1% expansion a year ago.
Similarly, farm sector GVA growth remained subdued at 2% as compared to 5.1% in the corresponding period of the previous fiscal.
Construction sector GVA growth too slowed to 5.7% from 9.6% earlier.
However, mining sector growth climbed to 2.7% from 0.4% a year ago.
The previous low in GDP growth was recorded at 4.3% in January-March quarter of 2012-13. India's economic growth stood at 8% in the same quarter of 2018-19.
"GDP at Constant (2011-12) Prices in Q1 of 2019-20 is estimated at Rs 35.85 lakh crore, as against Rs 34.14 lakh crore in Q1 of 2018-19, showing a growth rate of 5 percent," the National Statistical Office (NSO) said in a statement.
Gross Fixed Capital Formation (GFCF), which is a barometer of investment, at constant (2011-12) prices was estimated at Rs 11.66 lakh crore in the first quarter as against Rs 11.21 lakh crore a year ago.
In terms of GDP, GFCF at current and constant prices during the first quarter was estimated at 29.7% and 32.5%, respectively, as against 30% and 32.8% a year ago.
The Reserve Bank had marginally lowered the GDP growth projection for 2019-20 to 6.9% from 7% projected earlier in the June policy, and underlined the need for addressing growth concerns by boosting aggregate demand.
"Real GDP growth for 2019-20 is revised downwards from 7 per cent in the June policy to 6.9 per cent - in the range of 5.8-6.6 per cent for firs half of 2019-20 and 7.3-7.5 per cent for the second half - with risks somewhat tilted to the downside," RBI had said in the monetary policy statement.
China's economic growth was 6.2% in April-June quarter of 2019, which was the weakest expansion in 27 years.
Newsclick adds: The government’s dismal GDP data comes at a time when the Narendra Modi government has targeted making India a $3 trillion economy this financial year and a $ 5 trillion economy by 2024, as announced by Finance Minister Nirmala Sitharaman in her Budget speech in July.
In fact, a new World Bank report has pushed India to the seventh place in global rankings of GDP (gross domestic product) in 2018, from the sixth position earlier. It has been overtaken by France and the United Kingdom.
According to latest World Bank data, in 2018, India’s GDP was $2.72 trillion, while that of the UK was $2.82 trillion and France was $2.77 trillion. The top four economies in the world were the United States, with a GDP of 20.5 trillion in 2018, followed by China ($13.6 trillion), Japan ($4.9 trillion) and Germany ($3.9 trillion).