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The Government today pegged GDP growth at a higher-than-expected 7.1 per cent for the current fiscal despite note ban with agriculture sector doing exceptionally well, helping India retain the tag of world's fastest growing major economy. The Central Statistics Office (CSO) put the growth rate for October-December -- the quarter in which the government banned 86 per cent of the currency in circulation -- at 7 per cent, compared to 7.4 per cent in the second quarter and 7.2 per cent in the first quarter. The growth rate was on a higher base after the CSO revised 2015-16 GDP growth rate to 7.9 per cent from the earlier provisional estimate of 7.6 per cent. India's growth was higher than China's 6.8 per cent for the October-December period of 2016. Economic Affairs Secretary Shaktikanta Das said the CSO numbers have vindicated the government's position and the criticism of note ban was anecdotal and not supported by data. The CSO data revealed that GVA (Gross Value Added) is anticipated to increase from Rs 104.70 lakh crore in 2015-16 to Rs 111.68 lakh crore in 2016-17. "Anticipated growth of real GVA at basic prices in 2016-17 is 6.7 per cent against 7.8 per cent in 2015-16," the release said. The 'agriculture, forestry and fishing sector' is likely to show 4.4 per cent growth in its GVA during 2016-17, as against the previous year's growth of 0.8 per cent. The growth numbers were better than those projected by the RBI (6.9 per cent) and international agencies like IMF (6.6 per cent).
The GDP projection for the fiscal at 7.1 per cent in the second advance estimate is same as it was suggested in January by the CSO. Replying to questions after releasing data, Chief Statistician T C A Anant said that policies like demonetisation are very difficult to assess without a lot of data coming. "But the immediate effect is based on the data currently available. We will keep on evaluating our numbers as and when more data is available," he added. Commenting on the data, Ranen Banerjee of PwC India said: "While the Q3 GDP estimates have been put at 7 per cent, this may not have factored in the entire short-term impact of demonetisation. The impacts are likely to be more visible in Q4 with the lag effects of November and December becoming more pronounced."
The latest estimates have been arrived at by factoring in discrepancies or the difference between GDP calculated by different methods at Rs 1.18 lakh crore or one per cent of the Indian economy. It was Rs 45,407 crore or 0.4 per cent of GDP in 2015-16.
Meanwhile, the CSO has also marginally revised upwards the GDP estimates for the first and the second quarters to 7.2 per cent and 7.4 per cent, respectively.
The Gross Domestic Product (GDP) at constant (2011-12) prices in 2016-17 is likely to attain a level of Rs 121.65 lakh crore, as against the first revised estimate of GDP for 2015-16 of Rs 113.58 lakh crore, released in January 2017.
The second advance estimates of National Income, 2016-17, revealed that the growth in the GVA from 'manufacturing' sector is estimated to be 7.7 per cent compared to 10.6 per cent in 2015-16.
The per capita net national income (current price) during 2016-17 is estimated to be Rs 1,03,818 showing a rise of 10.2 per cent compared to Rs 94,178 during 2015-16 with the growth rate of 8.9 per cent.
Private Final Consumption Expenditure (PFCE) at current prices is estimated at Rs 88.40 lakh crore in 2016-17 as against Rs 79.00 lakh crore in 2015-16. At constant (2011-12) prices, the PFCE is estimated at Rs 68.26 lakh crore in 2016-17 as against Rs 63.66 lakh crore in 2015-16.
In terms of GDP, the rates of PFCE at current and constant prices during 2016-17 are estimated at 58 per cent and 56.1 per cent, respectively, as against the corresponding rates of 57.8 per cent and 56.1 per cent, respectively in 2015-16.
The CSO data further revealed that Gross Fixed Capital Formation (GFCF) at current prices is estimated at Rs 40.97 lakh crore in 2016-17 as against Rs 39.89 lakh crore in last fiscal. At constant prices, the GFCF is estimated at Rs 35.55 lakh crore in 2016-17 as against Rs 35.35 lakh crore year-on-year. "In terms of GDP, the rates of GFCF at current and constant (2011-12) prices during 2016-17 are estimated at 26.9 per cent and 29.2 per cent, respectively, as against the corresponding rates of 29.2 per cent and 31.1 per cent, respectively in 2015-16," the CSO said.
Ficci Secretary General Didar Singh said with the second advance estimate for 2016-17 at 7.1 per cent, the data belies the widespread expectation of sub 7.0 per cent growth this fiscal year. "The process of remonetisation is complete and we see the economy getting back on track," he added.
Meanwhile, another macro data released by the government revealed that the growth of eight core sectors slowed down to a five-month low of 3.4 per cent in January mainly due to contraction in output of refinery products, fertiliser and cement.


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