New Delhi, Jan 6: The economic growth of the country in the financial year 2016-17 ending March 31is estimated to be at 7.1 percent registering a slight fall from 7.6 percent of the last fiscal.
This is attributed to the decision of demonetization taken by the Narendra Modi government on November 8 last year. According to the data released by the Indian Central Statistics Office (ICSO), the demonetization move has caused a sharp fall in cash storage as the move scrapped the high denomination currency notes from the market. The decision was taken to end tax evasion, corruption and eliminate black money besides pushing India towards digital money transactions.
Still, it is considered to be ‘far better’ than 4 percent during the tenure of P Chidambaram and 5 percent during Manmohan Singh’s time, observers feel.
Releasing the data compiled by the Central Statistics Office (CSO), Chief Statistician T C A Anant said the figures for November were available and examined but “it was felt in view of the policy of de-notification of notes there is a high degree of volatility in these figures and conscious decision was taken not make projection using the November figure”.
Accordingly, the ‘First Advance Estimates of National Income, 2016-17’ did not reflect the impact of demonetization, effected on November 8 banning old Rs 500 and 1,000 notes, and are based on sectoral data for only seven months or till October.
Real GDP or Gross Domestic Product (GDP) at constant (2011-12) prices in the year 2016-17 is likely to attain a level of Rs 121.55 lakh crore, as against the Provisional Estimate of GDP for the year 2015-16 of Rs 113.50 lakh crore, released May 31, 2016.
“The growth in GDP during 2016-17 is estimated at 7.1 percent as compared to the growth rate of 7.6 percent in 2015- 16,” the CSO said.
The CSO projections on national income are now in line with the Reserve Bank's estimates, which too has lowered the GDP growth prospects to 7.1 per cent.
“Anticipated growth of real GVA at basic prices in 2016-17 is 7 per cent against 7.2 per cent in 2015-16,” the CSO said.
In value terms, the Gross Value Added (GVA) at constant prices is anticipated to increase from Rs 104.27 lakh crore in 2015-16 to Rs 111.53 lakh crore in 2016-17.
As per the data, Agriculture, forestry and fishing are expected to expand by 4.1 percent in 2016-17 from 1.2 percent.
On the other hand, mining and quarrying are likely to shrink by 1.8 per cent after recording a growth a 7.4 percent in 2015-16.
Growth in manufacturing is expected to slow to 7.4 percent (from 9.3 percent) and construction activities to 2.9 percent (from 3.9 percent).
As per the data, the per capita net national income (current prices) during 2016-17 is estimated to be Rs 1,03,007 showing a rise of 10.4 per cent as compared to Rs 93,293 during 2015-16 with the growth rate of 7.4 percent.