In an indication that a full-fledged economic revival may be more challenging than anticipated, the Central Statistics Office on Friday scaled down the economic growth rate for 2014-15 to 7.2 per cent from its earlier estimate of 7.3 per cent, and that for 2013-14 to 6.6 per cent from the previous 6.9 per cent.
“The real gross domestic product (GDP) for the years 2014-15 and 2013-14 stands at ₹105.52 lakh crore and ₹98.39 lakh crore, respectively, showing growth of 7.2 per cent during 2014-15, and 6.6 per cent during 2013-14,” it said in the First Revised Estimate for National Income for 2014-15.
Gross value added in 2014-15 is now estimated at 7.1 per cent, marginally lower than the 7.2 per cent in the provisional estimate that was released in May 2015, primarily due to muted growth in the farm sector as well as manufacturing, trade and transport and financial services.
The GDP growth rate for 2013-14 was also lowered to 6.6 per cent from the previous 6.9 per cent and for 2012-13 to 5.6 per cent.
“The First Revised Estimates are based on updated figures from various sources, including the Annual Survey of Industries and the MCA 21 database (Ministry of Corporate Affairs figures on filings by companies). Broadly speaking, the change has led to a reduction in nominal GDP. The growth rates are less affected but there has been some effect on the growth rates,” TCA Anant, Secretary, Ministry of Statistics and Programme Implementation, told BusinessLine.
A more comprehensive picture of the economy will emerge on February 8, when the CSO releases the GDP data for the third quarter of 2015-16 as well as advance growth estimates for the current fiscal year.
However, analysts said the low GDP growth would mean that the Centre would need to work harder to keep the fiscal deficit in check.
“Factoring in the revised GDP for 2014-15 and a nominal GDP growth of 8.2 per cent instead of the 11.5 per cent assumed in the Budget for 2015-16, the Centre’s fiscal deficit would need to be curtailed by nearly ₹29,000 crore as compared to the Budget Estimates, to meet the target of 3.9 per cent of GDP,” said Aditi Nayar, Senior Economist, ICRA.