GDP grows faster at 6.3% in Q2 despite GST muddle

The Indian economy grew at a faster pace of 6.3 per cent in fiscal second quarter despite the pangs of the newly-introduced goods and services tax (GST) and the after effects of the demonetisation exercise, official figures released today showed.

India's economy had grown at an estimated 5.7 per cent in the previous quarter, according to provisional figures released earlier.

India's gross domestic product (GDP) at constant (2011-12) prices in the second quarter of the current fiscal (July-September 2017-18) is estimated at Rs31,66,000 crore, against Rs29,79,000 crore in Q2 of 2016-17, showing a growth rate of 6.3 per cent. 

Quarterly GVA (gross value added) at basic price at constant (2011-12) prices for Q2 of 2017-18 is estimated at rs29,18,000 crore, against Rs27,51,000 crore in Q2 of 2016-17, showing a growth rate of 6.1 per cent year-on-year.

The economic activities which recorded growth of over 6 per cent in Q2 of  2017-18 included 'manufacturing', 'electricity, gas, water supply and other utility services' and 'trade, hotels, transport and communication and services related to broadcasting'.

Growth in 'agriculture, forestry and fishing', 'mining and quarrying', 'construction', 'financial, insurance, real estate and professional services' and 'public administration, defence and other services' is estimated to be 1.7 per cent, 5.5 per cent, 2.6 per cent, 5.7 per cent and 6.0 per cent respectively, during this period.

With the introduction of  goods and services tax (GST) from 1 July 2017 and consequent changes in the tax structure, the total tax revenue used for GDP compilation  include  non-GST revenue  and GST revenue based on GSTR filings  as provided by Central Board of Excise and Customs, Department of Revenue, the Central Statistics Office (CSO) said.

GDP is derived by adding taxes on products, net of subsidies on products, to GVA at basic prices. The taxes on products include both GST and non-GST revenue of central and state governments.

GDP at current prices in Q2 of 2017-18 is estimated at Rs40,22,000 crore, against Rs36,76,000 crore in Q2 of 2016-17, showing a growth rate of 9.4 per cent.

GVA at basic price at current prices in Q2 of 2017-18 is estimated at Rs36,40,000 crore, against Rs33,52,000 crore in Q2 of 2016-17, showing an increase of 8.6 per cent.

The wholesale price index (WPI) in respect of the groups - food articles, minerals, manufactured products and all commodities, registered growth rates of 3.4 per cent, 2.1 per cent, 2.4 per cent, and 2.6 per cent, respectively whereas electricity declined by 1.6 per cent during Q2 of 2017-18.

The consumer price index (CPI) has shown a rise of 3.0 per cent during Q2 of 2017-18 compared to growth of 5.2 per cent during Q2 of 2016-17.