The Ministry of Statistics and Programme Implementation released figures on November 30 showing that India’s GDP growth more than halved to 6.3 % in July-September from 13.5 % in April-June. The most recent estimate of quarterly growth, which came in at 6.3%, is in line with both the consensus estimate and the Reserve Bank of India’s (RBI) own expectation of 6.3%.
What does the GVA- Gross value added depict?
Gross Value Added, or GVA, increased by 5.6 % from July through September, a decrease from 12.7 % in April through June and 8.3% in the same period last year. India’s GDP increased by 16.2 % last quarter in nominal terms. The disappearance of a favorable base effect caused the abrupt decline in GDP growth from July to September. There were, however, some weak sectors, with manufacturing’s GVA declining by 4.3 % after expanding by 4.8 % from April to June.
Another unexpected development, albeit a good one, concerned the agriculture sector, whose GVA climbed by 4.6 % annually in July—September, somewhat higher than the 4.5 % growth seen in the previous quarter. India’s GDP increased by 16.2 % in nominal terms over the last quarter.
The diminishing impact of a favorable base effect brought on the abrupt decline in GDP growth from July to September. The GVA of manufacturing shrank by 4.3 % after expanding by 4.8 % from April to June, one of the weaker industries. The agricultural sector also provided a surprise, albeit a good one, as its GVA climbed by 4.6 % on an annual basis in the period from July to September, slightly higher than the 4.5 % growth recorded in the previous quarter.
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