With GDP growth of 7.2% India continues as the fastest growing economy : Full report by CSO

GDP of India Grows as 7.2%

The Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation has released the First Revised Estimates of National Income, GDP, Consumption Expenditure, Saving and Capital Formation for the financial year 2017-18 along with Second Revised Estimates for the financial year 2016-17 and Third Revised Estimates for the financial year 2015-16 (with Base Year 2011-12) as per the revision policy*. Earlier estimates for 2011-12 to 2016-17 were released vide press note dated 31st January, 2018 and Provisional Estimates of 2017-18 were released on 31st May, 2018.

* Available on www.mospi.gov.in and pib.nic.in

2.        

The First Revised Estimates for 2017-18 have been compiled using

industry-wise/institution-wise detailed information instead of using the

benchmark-indicator method employed at the time of release of

Provisional Estimates on 31st May, 2018. The estimates of GDP

and other aggregates for 2015-16 and 2016-17 have undergone revision on

account of use of latest available data on agricultural production;

industrial production; government expenditure (replacing Revised

Estimates with Actual for 2016-17) and also more comprehensive data

available from various source agencies like MCA, NABARD etc. and

State/UT Directorates of Economics and Statistics.

3.         The salient features of the estimates at aggregate level are indicated below:

Gross Domestic Product

4.        

Nominal GDP or GDP at current prices for 2017-18 is estimated as Rs.

170.95 lakh crore while that for 2016-17 is estimated as Rs. 153.62 lakh

crore, exhibiting a growth of 11.3 per cent during 2017-18 as against

11.5 per cent during 2016-17.

5.        

Real GDP or GDP at constant (2011-12) prices for 2017-18 and 2016-17

stand at Rs. 131.80 lakh crore and Rs. 122.98 lakh crore, respectively,

showing growth of 7.2 per cent during  2017-18 and 8.2 per cent during

2016-17.

Industry-wise Analysis

6.        

The changes in the Gross Value Added (GVA) at basic prices in different

sectors of the economy at current and constant (2011-12) prices are

presented in Statements 4.1 and 4.2 respectively. At the aggregate

level, nominal GVA at basic prices increased by 11.1 per cent during

2017-18 as against 10.8 per cent during 2016-17. In terms of real GVA,

i.e. GVA at constant (2011-12) basic prices, there has been a growth of

6.9 per cent in 2017-18, as against growth of 7.9 per cent in 2016-17.

7.

        The shares of different sectors of the economy in terms of

overall GVA during 2011-12 to   2017-18 and corresponding annual growth

rates are mentioned below:

Year

Share in GVA at current prices (In %)

Growth in GVA at constant (2011-12) prices (In %)

Aggregate GVA (Rs. in lakh crore)

Primary

Secondary

Tertiary

All

Primary

Secondary

Tertiary

All

Current

Constant

2011-12

21.7

29.3

49.0

100.0

81.1

81.1

2012-13

21.3

28.7

50.0

100.0

1.4

3.6

8.3

5.4

92.0

85.5

2013-14

21.4

27.9

50.6

100.0

4.8

4.2

7.7

6.1

103.6

90.6

2014-15

20.9

27.3

51.8

100.0

1.2

6.7

9.8

7.2

115.0

97.1

2015-16

20.1

27.6

52.3

100.0

2.1

9.5

9.4

8.0

125.7

104.9

2016-17

20.2

27.1

52.7

100.0

6.8

7.5

8.4

7.9

139.4

113.2

2017-18

19.5

27.0

53.5

100.0

5.0

6.0

8.1

6.9

154.8

121.0

8.        

The growth in real GVA during  2017-18 has been lower than that in

2016-17 mainly due to relatively lower growth in ‘agriculture, forestry

& fishing’, ‘mining and quarrying’, ‘manufacturing’, ‘electricity,

gas, water supply & other utility services’, ‘communication &

services related to broadcasting’ and ‘real estate, ownership of

dwelling & professional services’, as may be seen from Statement

4.2. During 2017-18, at constant prices, the growth rates of primary

(comprising agriculture, forestry, fishing and mining & quarrying),

secondary (comprising manufacturing, electricity, gas, water supply

& other utility services, and construction) and tertiary (services)

sectors have been estimated as 5.0 per cent, 6.0 per cent and 8.1 per

cent as against a growth of 6.8 per cent, 7.5 per cent and 8.4 per cent,

respectively, in the previous year.

Net National Income

9.        

Nominal Net National Income (NNI) at current prices for 2017-18 stands

at Rs. 151.28 lakh crore as against Rs. 135.95 lakh crore in 2016-17,

showing an increase of 11.3 per cent during 2017-18 as against an

increase of 11.8 per cent in the previous year.

Gross National Disposable Income

10.      

Gross National Disposable Income (GNDI) at current prices is estimated

as Rs. 173.16 lakh crore for 2017-18, while the estimate for 2016-17

stands at Rs. 155.65 lakh crore, showing a growth of 11.2 per cent in

2017-18 as against 11.0 per cent in 2016-17.

Saving

11.      

Gross Saving during 2017-18 is estimated at Rs. 52.16 lakh crore

against Rs.46.48 lakh crore during 2016-17. Rate of Gross Saving to GNDI

for 2017-18 is estimated at 30.1 per cent against 29.9 per cent for

2016-17.

12.      

The highest contributor to Gross Saving is the household sector with

saving of Rs. 29.38 lakh crore in 2017-18. The saving of non-financial

corporations has increased from Rs. 18.10 lakh crore in 2016-17 to Rs.

20.73 lakh crore in 2017-18.  Further, the saving of the financial

corporations has also increased from Rs. 3.37 lakh crore during 2016-17

to Rs. 3.68 lakh crore in 2017-18. The saving of General Government was

(-) Rs. 1.21 lakh crore during 2016-17 and (-) Rs. 1.63 lakh crore in

2017-18.

Capital Formation

13.      

Gross Capital Formation (GCF) at the current as well as the constant

prices is estimated by two approaches :– (i) through flow of funds,

derived as Gross Saving plus net capital inflow from Rest of the World

(ROW); and (ii) by the commodity flow approach, derived by the type of

assets. The estimates of GCF through the flow of funds approach are

treated as the firmer estimates. GCF by industry of use and by

institutional sectors does not include ‘valuables’ and therefore, these

estimates are lower than the estimates available from commodity flow

approach.

14.      

GCF at current prices is estimated at Rs. 55.27 lakh crore for 2017-18

compared to Rs. 47.41 lakh crore during 2016-17. The rate of GCF to GDP

increased from 30.9 per cent during 2016-17 to 32.3 per cent in the

2017-18. The rate of GCF (excluding valuables) to GDP stands at 29.8 per

cent and 31.1 per cent for 2016-17 and 2017-18 respectively. The rate

of capital formation in 2011-12 to 2017-18 has been higher than the rate

of saving because of positive net capital inflow from ROW.

15.      

In terms of the share to the total GCF (at current prices), the highest

contributor is Non-Financial Corporations. However, its share has

declined from 50.6 percent in 2016-17 to 49.5 percent in 2017-18

(Statement 9). Share of household sector in GCF has declined from 35.9

percent in 2016-17 to 34.9 percent in 2017-18. The share of General

Government in GCF has increased from 12.9 per cent in 2016-17 to 13.3

per cent in 2017-18.

16.      

Within the GCF at current prices, the Gross Fixed Capital Formation

(GFCF) amounted to Rs. 48.97 lakh crore in 2017-18 against Rs. 43.35

lakh crore in 2016-17.  The rate of GFCF to GDP at current prices has

increased from 28.2 per cent in 2016-17 to 28.6 per cent in 2017-18. The

change in stocks of inventories, at current prices, increased from Rs.

1.40 lakh crore in 2016-17 to Rs. 1.74 lakh crore in 2017-18, while the

valuables increased from Rs. 1.67 lakh crore in 2016-17 to Rs. 2.19 lakh

crore in 2017-18.

17.      

The rate of GCF to GDP at constant (2011-12) prices has increased from

33.7 per cent in 2016-17 to 35.5 per cent in 2017-18.

Consumption Expenditure

18.      

Private Final Consumption Expenditure (PFCE) at current prices is

estimated at Rs. 100.83 lakh crore for 2017-18 as against Rs. 91.16 lakh

crore in 2016-17. In relation to GDP, the rates of PFCE at current

prices during 2016-17and 2017-18 are estimated at 59.3 per cent and 59.0

per cent respectively.

19.      

At constant (2011-12) prices, the PFCE is estimated as Rs. 69.04 lakh

crore and Rs. 74.17 lakh crore, respectively for 2016-17 and 2017-18.

The corresponding rates of PFCE to GDP for 2016-17 and 2017-18 are 56.1

per cent and 56.3 per cent respectively.

20.      

Government Final Consumption Expenditure (GFCE) at current prices is

estimated as Rs. 18.86 lakh crore for 2017-18 as against Rs. 15.83 lakh

crore during 2016-17. At constant (2011-12) prices, the estimates of

GFCE for 2016-17 and 2017-18 stand at Rs. 11.99 lakh crore and Rs. 13.79

lakh crore respectively.

Estimates at per Capita Level

21.      

Per Capita Income, i.e. Per Capita Net National Income at current

prices, is estimated as Rs. 1,04,659 and Rs. 1,14,958  for 2016-17 and

2017-18 respectively.  Correspondingly, Per Capita PFCE at current

prices, for 2016-17 and 2017-18 is estimated at Rs. 70,175 and Rs.

76,619 respectively.

22.       More details of these estimates are available in Statements 1-9, appended to this Press Note.

Summary of Revision in the GDP Estimates

23.      

The use of latest available data from various agencies has resulted in

some changes in both the levels of GVA and growth estimates for 2015-16

and 2016-17. The reasons for revision in the estimates of  2015-16 and

2016-17, released on 31.05.2018 are summarized in the Annexure.

Revision in the Estimates of 2017-18:

24.      

The following statement gives the major reasons for variation between

the Provisional Estimates (released in May 2018) and the First Revised

Estimates of GVA for 2017-18.

 

Sector

GVA growth in 2017-18 (at (2011-12) prices

Major Reasons for  Variation

Provisional Estimate, May 2018

First Revised Estimate,

Jan 2019

Primary[i]

3.3

5.0

Use

of Fourth Advance Estimates of Crop Production and Final estimates of

horticulture crops as against Third Advance Estimates of Crop Production

and Second Advance Estimates of Horticulture crops used in the

Provisional Estimates; revision in estimates of livestock products; and

use of annual financial reports of public & private sector companies

in place of IIP in the case of ‘mining & quarrying’.

Secondary[ii]

5.8

6.0

Actual

analysis of financial reports of a larger sample of public &

private sector companies instead of key financial indicators derived

from advance filings of a small sample of companies used earlier.

Tertiary[iii]

7.9

8.1

Use

of Revised Estimates of sales tax and other items in central &

state government budget documents instead of Budget Estimates and

replacement of key financial indicators derived from advance filings of a

small sample of companies with actual analysis of financial reports of a

larger sample of public & private sector companies.

Total GVA at Basic Prices

6.5

6.9

 

GDP

6.7

7.2

 

Upcoming Releases

25.       The upcoming releases on GDP are indicated below:

Second

Advance Estimates for 2018-19, along with quarterly estimates for Q1

(April-June), Q2 (July-September) and Q3 (October-December) of 2018-19

on February 28th , 2019; andProvisional Estimates for 2018-19, along with estimates for all the four quarters on May 31st , 2019.

*****************

List of Statements

1

Statement 1.1:

Key Aggregates of National Accounts at Current Prices

2

Statement 1.2:

Key Aggregates of National Accounts at Constant (2011-12) Prices

3

Statement 2:

Per Capita Income, Product and Final Consumption

4

Statement 3.1:

Output by Economic Activity and Capital Formation by Industry of Use at Current Prices

5

Statement 3.2:

Output by Economic Activity and Capital Formation by Industry of Use at Constant (2011-12) Prices

6

Statement 4.1:

Gross Value Added by Economic Activity at Current Basic Prices

7

Statement 4.2:

Gross Value Added by Economic Activity at Constant (2011-12) Basic Prices

8

Statement 5:

Finances for Gross Capital Formation

9

Statement 6.1:

Gross Capital Formation by Industry of Use at Current Prices

10

Statement 6.2:

Gross Capital Formation by Industry of Use at Constant (2011-12) Prices

11

Statement 7.1:

Gross Fixed Capital Formation by Asset & Institutional Sector at Current Prices

12

Statement 7.2:

Gross Fixed Capital Formation by Asset & Institutional Sector at Constant (2011-12) Prices

13

Statement 8.1:

Private Final Consumption Expenditure at Current Prices

14

Statement 8.2:

Private Final Consumption Expenditure at Constant (2011-12) Prices

15

Statement 9:

Institutional Sectors – Key Economic Indicators at Current Prices

Annexure: Reasons for revision in the estimates of 2015-16 to 2016-17

NOTES ON THE STATEMENTS

 

ACRONYMS USED IN THE PRESS RELEASE

ASI:     

Annual Survey of Industries

CE:     

Compensation of Employees

CFC:  

Consumption of Fixed Capital

CIS:    

Changes in Stock

CPI:      

Consumer Price Index

DE:      

Departmental Enterprises

GCF:  

Gross Capital Formation

GDI:   

Gross Disposable Income

GDP:  

Gross Domestic Product

GFCE:

Government Final Consumption Expenditure

GFCF:

Gross Fixed Capital Formation

GG:

General Government

GNDI: 

Gross National Disposable Income

GNI:   

Gross National Income

GST:    

Goods and Services Tax

GVA:

Gross Value Added

GVO:

Gross Value of Output

HH:

Households

IIP:       

Index of Industrial Production

MCA:   

Ministry of Corporate Affairs

MI:     

Mixed Income

NABARD:

National Bank for Agriculture and Rural Development

NAFSCOB:

National Federation of State Cooperative Banks Limited

NAS:

National Accounts Statistics

NBFI:   

Non-Banking Financial Institutions

NDE:   

Non- Departmental Enterprises

NDP:  

Net Domestic Product

NNDI:

Net National Disposable Income

NNI:   

Net National Income

NVA:

Net Value Added

OS:     

Operating Surplus

PC:       

Private Corporate

PE:       

Provisional Estimates

PFCE:            

Private Final Consumption Expenditure

RBI:

Reserve Bank of India

RE:      

Revised Estimates

ROW:

Rest of the World

SEBI:   

Securities and Exchange Board of India

WPI:    

Wholesale Price Index

FORMULAE

GVA at basic prices = CE + OS/MI + CFC + Production taxes(i) less Production subsidies(ii)GDP = ∑ GVA at basic prices + Product taxes – Product subsidiesNDP/NNI = GDP/GNI – CFCGNI = GDP + Net primary income from ROW (Receipts less payments)Primary Incomes = CE + Property and Entrepreneurial IncomeNNDI =NNI + other current transfers from ROW, net (Receipts less payments)GNDI = NNDI + CFC = GNI + other current transfers(iii) from ROW, net (Receipts less payments)Gross Capital Formation(iv)= Gross Saving+ Net Capital Inflow from ROWGCF = GFCF + CIS + Valuables + “Errors and Omissions”Gross Disposable Income of Govt. = GFCE + Gross Saving of General GovernmentGross Disposable Income (GDI) of Households = GNDI – GDI of Govt. – Gross Saving of all Corporations

REMARKS ON THE FORMULAE:

Production

taxes or subsidies are paid or received with relation to production and

are independent of the volume of actual production. Some examples are:

Production Taxes – Land Revenues, Stamps and Registration fees etc.

Production Subsidies – Subsidies to Railways, Subsidies to village and small industries

 Product taxes or subsidies are paid or received on per unit of product. Some examples are:

Product Taxes: Excise Tax, Sales tax, Service Tax and Import and Export duties

Product Subsidies: Food, Petroleum and fertilizer subsidies

Other Current Transfers refers to current transfers other than the primary incomes  Estimate

of GCF derived from the formula is taken as the “firmer” estimate and

the difference between this estimate and the sum of GFCF, CIS and

valuables is taken as “errors and omissions”, as referred in 9 above.

Annexure

REASON(S) FOR REVISION IN THE ESTIMATES FOR THE YEARS 2015-16 AND 2016-17

Revision in Major Aggregates

The level of revisions in the major aggregates at current and constant (2011-12) prices are given in the following table:

Major National Income Aggregates and their % changes

(Amount Rs. In Lakh Crore)

S.No.

Item

2015-16

2016-17

2nd RE

3rd RE

%  change

1st RE

2nd RE

%  change

At current prices

1

GVA at basic prices

125.67

125.74

0.06

138.42

139.36

0.68

2

GDP

137.64

137.72

0.06

152.54

153.62

0.71

3

GNI

136.04

136.12

0.06

150.77

151.86

0.72

4

NNI

121.54

121.62

0.07

134.93

135.95

0.76

5

GNDI

140.17

140.25

0.06

154.57

155.65

0.70

At constant (2011-12) prices

1

GVA at basic prices

105.03

104.92

-0.11

112.48

113.19

0.63

2

GDP

113.86

113.70

-0.15

121.96

122.98

0.84

3

GNI

112.51

112.35

-0.15

120.52

121.54

0.85

4

NNI

99.85

99.64

-0.21

106.82

107.73

0.85

The reasons for revision in GVA/GDP are as under:

Year 2015-16

Use of updated estimates of production and prices of some crops, livestock products, fish and forestry products.  Use of final results of ASI: 2015-16 instead of provisional results.Use of updated information on local bodies & autonomous institutions.

Year 2016-17

Use of updated estimates of production and prices of some crops, livestock products, fish and forestry products.  Use of provisional results of ASI: 2016-17Replacement of ‘Revised Estimates’ of different items of expenditure and receipts in the Central & State government budgets by ‘Actuals’  Use of updated information on Local Bodies & Autonomous Institutions  Use of updated MCA21 database received from the Ministry of Corporate AffairsUse of latest annual report of Public Sector EnterprisesUse of latest data received for Cooperative Banks, NBFIs and financial auxiliaries from NABARD, NAFSCOB, MCA and SEBI.

You might also like : Food grain production rise by 7.5% in past 4.5 Years

Also Read : India to stress on electric and bio-fuel vehicles : Nithin Gadkari