The economic growth is expected to slow to a four-year low of 6.5 per cent in 2017-18, the lowest under the Modi-led government, mainly due to poor performance of agriculture and manufacturing sectors.

The Gross Domestic Product (GDP) was 7.1 per cent in 2016-17 and 8 per cent in the preceding year. It was 7.5 per cent in 2014-15.

The Narendra Modi-led NDA government had assumed office in May 2014.

&quot;The growth in GDP during 2017-18 is estimated at 6.5 per cent as compared to the growth rate of 7.1 per cent in 2016- 17,&quot; said the Central Statistics Office (CSO) while announcing the first advance estimates of National Income 2017-18.

The growth of real Gross Value Added (GVA) in 2017-18 is anticipated at 6.1 per cent as against 6.6 per cent in the previous year.

Economic activities were affected by demonetisation announced on November 8, 2016 and subsequent implementation of a new indirect tax regime (GST) from July 1 in the current financial year.

As per the CSO data, the expansion in activities in &#39;agriculture, forestry and fishing&#39; is likely to slow to 2.1 per cent in the current fiscal from 4.9 per cent in the preceding year.

The growth in manufacturing sector too is expected to decelerate to 4.6 per cent this fiscal, down from 7.9 per cent in 2016-17.

The Gross Domestic Product (GDP) was 7.1 per cent in 2016-17 and 8 per cent in the preceding year. It was 7.5 per cent in 2014-15.

The economic growth is expected to slow to a four-year low of 6.5 per cent in 2017-18, the lowest under the Modi-led government, mainly due to poor performance of agriculture and manufacturing sectors. The Gross Domestic Product (GDP) was 7.1 per cent in 2016-17 and 8 per cent in the preceding year. It was 7.5 per cent in 2014-15. The Narendra Modi-led NDA government had assumed office in May 2014. "The growth in GDP during 2017-18 is estimated at 6.5 per cent as compared to the growth rate of 7.1 per cent in 2016- 17," said the Central Statistics Office (CSO) while announcing the first advance estimates of National Income 2017-18. The growth of real Gross Value Added (GVA) in 2017-18 is anticipated at 6.1 per cent as against 6.6 per cent in the previous year. Economic activities were affected by demonetisation announced on November 8, 2016 and subsequent implementation of a new indirect tax regime (GST) from July 1 in the current financial year. As per the CSO data, the expansion in activities in 'agriculture, forestry and fishing' is likely to slow to 2.1 per cent in the current fiscal from 4.9 per cent in the preceding year. The growth in manufacturing sector too is expected to decelerate to 4.6 per cent this fiscal, down from 7.9 per cent in 2016-17.

India's GDP growth to slow to four-year low of 6.5% in 2017-18

Much to China&rsquo;s displeasure, Mongolia is all set to get its first oil refinery with India&#39;s help.

India offered a helping hand to the land-locked country in order to limit their dependence on China for its energy needs, a move which has upset President Xi&#39;s administration.

India provided the country with $700 million loan for the construction of the refinery and around $264 million for oil pipelines.&nbsp;

In 2015, during Prime Minister Narendra Modi&rsquo;s visit, India had announced a $1 billion credit line to finance infrastructure projects in the country.

As per media reports, the refinery will have the capacity to process 1.5 million metric tons of oil per year and will annually produce 560,000 tons of gasoline, 670,000 tons of diesel fuel and 107,000 tons of liquefied gas.&nbsp;

The refinery is expected to boost Mongolia&#39;s gross domestic product (GDP) by approx 10 per cent.

Mongolia&rsquo;s relations with China has&nbsp;experienced some turbulence after Dalai Lama paid a visit to the country in 2015.

In response, China imposed fees on imports from Mongolia and started charging additional transit costs to force the country into submission.

Mongolia has been warming up to India as part of its effort to limit Chinese influence and its dependence on Beijing.

The refinery will boost Mongolia's gross domestic product (GDP) by approx 10 per cent

Much to China’s displeasure, Mongolia is all set to get its first oil refinery with India's help. India offered a helping hand to the land-locked country in order to limit their dependence on China for its energy needs, a move which has upset President Xi's administration. India provided the country with $700 million loan for the construction of the refinery and around $264 million for oil pipelines. In 2015, during Prime Minister Narendra Modi’s visit, India had announced a $1 billion credit line to finance infrastructure projects in the country. As per media reports, the refinery will have the capacity to process 1.5 million metric tons of oil per year and will annually produce 560,000 tons of gasoline, 670,000 tons of diesel fuel and 107,000 tons of liquefied gas. The refinery is expected to boost Mongolia's gross domestic product (GDP) by approx 10 per cent. Mongolia’s relations with China has experienced some turbulence after Dalai Lama paid a visit to the country in 2015. In response, China imposed fees on imports from Mongolia and started charging additional transit costs to force the country into submission. Mongolia has been warming up to India as part of its effort to limit Chinese influence and its dependence on Beijing.

Watch: Mongolia to get first oil refinery with India's help, China upset

India&#39;s wholesale price based inflation rose&nbsp;to 3.93 per cent in&nbsp;November, as against 3.59 per cent in October.

&nbsp;The annual wholesale price inflation accelerated in November to an eight-month high, driven by faster rises in prices of food and fuel products, government data showed.&nbsp;

Inflation, based on the Wholesale Price Index (WPI), had risen to a six-month high in October due to increase in prices of food, onions and vegetables.

The government data had shown&nbsp;inflation in food articles more than doubled to 4.30 per cent in October.

In April, India&#39;s inflation stood at 3.85 per cent.

Last month, the Reserve Bank of India(RBI) had kept benchmark interest rate unchanged on fears of rising inflation while lowering growth forecast to 6.7 per cent for the current fiscal.

RBI also raised its inflation forecast to the 4.2-4.6 per cent range for the rest of the current fiscal as against 4-4.5 per cent previously.&nbsp; 
&nbsp;

The government data had shown?inflation in food articles more than doubled to 4.30 per cent in October.

India's wholesale price based inflation rose to 3.93 per cent in November, as against 3.59 per cent in October. The annual wholesale price inflation accelerated in November to an eight-month high, driven by faster rises in prices of food and fuel products, government data showed. Inflation, based on the Wholesale Price Index (WPI), had risen to a six-month high in October due to increase in prices of food, onions and vegetables. The government data had shown inflation in food articles more than doubled to 4.30 per cent in October. In April, India's inflation stood at 3.85 per cent. Last month, the Reserve Bank of India(RBI) had kept benchmark interest rate unchanged on fears of rising inflation while lowering growth forecast to 6.7 per cent for the current fiscal. RBI also raised its inflation forecast to the 4.2-4.6 per cent range for the rest of the current fiscal as against 4-4.5 per cent previously.

India's wholesale inflation rises to eight-month high in November

India&#39;s economy is projected to grow at 7.2 per cent in 2018 and 7.4 per cent in 2019, despite a slowdown observed this year and the lingering effects from the demonetisation, the UN has said.

The outlook for India remains largely positive, underpinned by robust private consumption and public investment as well as ongoing structural reforms, despite the slowdown observed in early 2017 and the lingering effects from the demonetisation policy, the United Nations said.

&quot;GDP growth for India is projected to accelerate from 6.7 per cent in 2017 to 7.2 per cent in 2018 and 7.4 per cent in 2019,&quot; the UN said in its report &#39;World Economic Situation Prospects&#39; (WESP 2018), released at the UN headquarters in New York yesterday.

At the same time, the report said, the performance of private investment remains a key macroeconomic concern.

&quot;Gross fixed capital formation as a share of GDP has declined from about 40 per cent in 2010 to less than 30 per cent in 2017, amid subdued credit growth, low capacity utilisation in some industrial sectors and balance sheet problems in the banking and corporate sectors.

&quot;In this environment, vigorous public investment in infrastructure has been critical in propping up overall investment growth,&quot; it said. 
According to the report, there exists some degree of uncertainty over the monetary policy stance in India.

&quot;Subdued inflation, coupled with a good monsoon season, offers scope for additional monetary easing,&quot; it said.

Fiscal deficit in India has declined visibly, and it is expected to narrow further to 3.2 per cent of GDP in 2018, it added. 
An upturn in the global economy - now growing by about three per cent - paves the way to reorient policy towards longer-term issues such as addressing climate change, tackling existing inequalities and removing institutional obstacles to development, according to the WESP report.

&quot;The World Economic Situation and Prospects 2018 demonstrates that current macroeconomic conditions offer policy-makers greater scope to address some of the deep-rooted issues that continue to hamper progress towards the Sustainable Development Goals,&quot; said UN Secretary-General Antonio Guterres in the foreword of the report.&nbsp;

The UN added that India would grow at 7.4% in 2019

India's economy is projected to grow at 7.2 per cent in 2018 and 7.4 per cent in 2019, despite a slowdown observed this year and the lingering effects from the demonetisation, the UN has said. The outlook for India remains largely positive, underpinned by robust private consumption and public investment as well as ongoing structural reforms, despite the slowdown observed in early 2017 and the lingering effects from the demonetisation policy, the United Nations said. "GDP growth for India is projected to accelerate from 6.7 per cent in 2017 to 7.2 per cent in 2018 and 7.4 per cent in 2019," the UN said in its report 'World Economic Situation Prospects' (WESP 2018), released at the UN headquarters in New York yesterday. At the same time, the report said, the performance of private investment remains a key macroeconomic concern. "Gross fixed capital formation as a share of GDP has declined from about 40 per cent in 2010 to less than 30 per cent in 2017, amid subdued credit growth, low capacity utilisation in some industrial sectors and balance sheet problems in the banking and corporate sectors. "In this environment, vigorous public investment in infrastructure has been critical in propping up overall investment growth," it said. According to the report, there exists some degree of uncertainty over the monetary policy stance in India. "Subdued inflation, coupled with a good monsoon season, offers scope for additional monetary easing," it said. Fiscal deficit in India has declined visibly, and it is expected to narrow further to 3.2 per cent of GDP in 2018, it added. An upturn in the global economy - now growing by about three per cent - paves the way to reorient policy towards longer-term issues such as addressing climate change, tackling existing inequalities and removing institutional obstacles to development, according to the WESP report. "The World Economic Situation and Prospects 2018 demonstrates that current macroeconomic conditions offer policy-makers greater scope to address some of the deep-rooted issues that continue to hamper progress towards the Sustainable Development Goals," said UN Secretary-General Antonio Guterres in the foreword of the report.

India's economy to grow at 7.2% in 2018: UN

The Reserve Bank is likely to keep the key rate unchanged on Wednesday and stay focused on inflation control as the rebound in September quarter GDP growth - after a five quarter decline - seemed to have eased pressure on it to lower rates, experts said.

India Inc, however, is demanding interest rate cut to further build on positive sentiment generated by the rebound and upgrade of the country&#39;s sovereign rating by Moody&#39;s.

The Monetary Policy Committee (MPC), headed by RBI Governor Urjit Patel, will meet on December 5 and 6 for the Fifth Bi-monthly Monetary Policy Statement for 2017-18. The resolution of the MPC will be made public on December 6.

In its October review, it had kept the benchmark interest rate unchanged on fears of rising inflation while lowering growth forecast to 6.7 per cent for the current fiscal.

The central bank had reduced the benchmark lending rate by 0.25 percentage points to 6 per cent in August, bringing it to a 6-year low.

Bankers and experts are of the view that the RBI for the second time in a row may key repo-rate or short-term lending rate unchanged as inflation trajectory is likely to remain upward in the coming months.

&quot;It&#39;s going to be a status quo. The liquidity in the system is very low, deposit rates are firming up and there are concerns about inflation,&quot; said Union Bank MD and CEO Rajkiran Rai G.

Global financial services major Nomura said while lower GST rates have moderated output prices, input cost pressures are marginally higher, which along with higher food inflation is likely to push retail inflation slightly above the RBI midpoint target of 4 per cent in November and beyond.

&quot;We expect a hawkish hold from the RBI..And policy rates to remain unchanged through 2018,&quot; it said in a report.

Wholesale prices-based inflation had shot up to a 6-month high of 3.59 per cent in October. The retail inflation (Consumer Price Index) for October rose to a 7-month high of 3.58 per cent.

Meanwhile, industry body Ficci said there has been positive news in the form of improvement in ease of doing business rankings, Moody?s upgrade of India&#39;s rating and the massive recapitalisation plan for banks.

&quot;This is a good opportunity to further build the confidence levels. The monetary policy announcement next week will be a perfect timing to give another shot to boost the sentiment,&quot; said Ficci President Pankaj Patel in a statement.

Reversing a five-quarter slide in GDP growth, Indian economy bounced back from a three-year low to expand by 6.3 per cent in the July-September period as manufacturing revved up and businesses adjusted to the new GST tax regime.

The GDP growth in the second quarter of 2017-18 compares to 5.7 per cent in April-June.

Credit rating firm ICRA has said RBI is likely to keep the key policy rate unchanged at 6 per cent as it expects retail inflation to firm up in the coming months.

It said the (MPC) would leave the repo rate unchanged at 6 per cent &quot;in a non-unanimous decision in the December 2017 policy review, given the expectation of a further rise in the CPI inflation in the coming months&quot;.

With gross value added (GVA) growth estimated by the Central Statistics Office at 5.8 per cent in first half of FY&#39;18, a downward bias is likely to be placed on the MPC&#39;s baseline forecast for growth of GVA at basic prices of 6.7 per cent for ongoing fiscal.&nbsp;

The Monetary Policy Committee headed by RBI Governor Urjit Patel will meet on December 5 and 6 for the Fifth Bi-monthly Monetary Policy Statement for 2017-18

The Reserve Bank is likely to keep the key rate unchanged on Wednesday and stay focused on inflation control as the rebound in September quarter GDP growth - after a five quarter decline - seemed to have eased pressure on it to lower rates, experts said. India Inc, however, is demanding interest rate cut to further build on positive sentiment generated by the rebound and upgrade of the country's sovereign rating by Moody's. The Monetary Policy Committee (MPC), headed by RBI Governor Urjit Patel, will meet on December 5 and 6 for the Fifth Bi-monthly Monetary Policy Statement for 2017-18. The resolution of the MPC will be made public on December 6. In its October review, it had kept the benchmark interest rate unchanged on fears of rising inflation while lowering growth forecast to 6.7 per cent for the current fiscal. The central bank had reduced the benchmark lending rate by 0.25 percentage points to 6 per cent in August, bringing it to a 6-year low. Bankers and experts are of the view that the RBI for the second time in a row may key repo-rate or short-term lending rate unchanged as inflation trajectory is likely to remain upward in the coming months. "It's going to be a status quo. The liquidity in the system is very low, deposit rates are firming up and there are concerns about inflation," said Union Bank MD and CEO Rajkiran Rai G. Global financial services major Nomura said while lower GST rates have moderated output prices, input cost pressures are marginally higher, which along with higher food inflation is likely to push retail inflation slightly above the RBI midpoint target of 4 per cent in November and beyond. "We expect a hawkish hold from the RBI..And policy rates to remain unchanged through 2018," it said in a report. Wholesale prices-based inflation had shot up to a 6-month high of 3.59 per cent in October. The retail inflation (Consumer Price Index) for October rose to a 7-month high of 3.58 per cent. Meanwhile, industry body Ficci said there has been positive news in the form of improvement in ease of doing business rankings, Moody?s upgrade of India's rating and the massive recapitalisation plan for banks. "This is a good opportunity to further build the confidence levels. The monetary policy announcement next week will be a perfect timing to give another shot to boost the sentiment," said Ficci President Pankaj Patel in a statement. Reversing a five-quarter slide in GDP growth, Indian economy bounced back from a three-year low to expand by 6.3 per cent in the July-September period as manufacturing revved up and businesses adjusted to the new GST tax regime. The GDP growth in the second quarter of 2017-18 compares to 5.7 per cent in April-June. Credit rating firm ICRA has said RBI is likely to keep the key policy rate unchanged at 6 per cent as it expects retail inflation to firm up in the coming months. It said the (MPC) would leave the repo rate unchanged at 6 per cent "in a non-unanimous decision in the December 2017 policy review, given the expectation of a further rise in the CPI inflation in the coming months". With gross value added (GVA) growth estimated by the Central Statistics Office at 5.8 per cent in first half of FY'18, a downward bias is likely to be placed on the MPC's baseline forecast for growth of GVA at basic prices of 6.7 per cent for ongoing fiscal.

RBI likely to keep interest rate on hold for second time in row

Markets nursed losses for the fourth straight session today as upbeat second-quarter GDP numbers failed to dispel concerns over a widening fiscal deficit.

The BSE benchmark Sensex dived 316 points to close below the 33,000-mark, while the broader Nifty declined 104.75 points to 10,121.80.

It was a forgettable week for both the key indices, with the Sensex recording a fall of 846.30 points, or 2.51 per cent and the NSE Nifty losing 267.90 points, or 2.57 per cent.

&quot;Despite data pointing to an improvement in the macro- economic environment, participants remained cautious and chose to sell stocks in the latter half of the trading day,&quot; said Karthikraj Lakshmanan, Senior Fund Manager, Equities, BNP Paribas Mutual Fund.

The 30-share benchmark, after scaling a high of 33,300.81 in early deals, slipped into the negative zone to touch 32,797.78, before settling at 32,832.94, down 316.41 points, or 0.95 per cent.

This was its weakest closing since November 15, when it had finished at 32,760.44.

The 50-issue NSE Nifty too cracked the 10,200-mark and hit a low of 10,108.55 before finishing 104.75 points, or 1.02 per cent down at 10,121.80.

Reversing a five-quarter slide in Gross Domestic Product (GDP) growth, the economy bounced back from a three-year low to expand by 6.3 per cent in July-September as manufacturing revved up and businesses adjusted to the new GST tax regime, data released after market hours yesterday showed.

However, participants remained risk-averse as India&#39;s fiscal deficit at the end of October hit 96.1 per cent of the budget estimate for 2017-18, mainly due to lower revenue realisation and rise in expenditure.

Meanwhile, foreign portfolio investors sold shares worth net Rs 1,500.76 crore, while domestic institutional investors (DIIs) bought shares to the tune of Rs 1,202.57 crore yesterday, as per provisional data.

Small and mid-cap indices fell 1.16 per cent and 0.95 per cent in today&#39;s session, respectively.

The session saw buying in select auto stocks such as Maruti Suzuki, TVS Motor and Ashok Leyland, buoyed by encouraging sales data for November.

Among Sensex constituents, Adani Ports suffered the most by diving 3 per cent, followed by Bajaj Auto 2.99 per cent despite the company reporting a 21 per cent rise in total sales in November.

Other big losers were Bharti Airtel (2.74 per cent), Sun Pharma (2.59 per cent), SBI (2.47 per cent), Dr Reddy&#39;s (2.44 per cent), Tata Steel (2.08 per cent), HUL (1.71 per cent), Infosys (1.69 per cent), Power Grid (1.51 per cent), Coal India (1.43 per cent), RIL (1.38 per cent), Tata Motors (1.36 per cent), HDFC LTD (1.11 per cent) and Hero MotoCorp (0.97 per cent).

However, Kotak Bank rose 0.23 per cent followed by NTPC 0.14 per cent.

Among BSE sectoral indices, realty dropped by 1.99 per cent followed by metal 1.75 per cent, infrastructure 1.63 per cent, oil &amp; gas 1.47 per cent, PSU 1.46 per cent, teck 1.43 per cent, power 1.38 per cent, IT 1.29 per cent and auto 0.99 per cent.

Globally, other Asian markets traded mixed after investors shifted nervously as US President Donald Trump&#39;s much-hyped tax-cut plans hung in the balance after a plan to push them through hit unexpected hurdles.

Hong Kong&#39;s Hang Seng finished 0.35 per cent lower, while Korea fell 0.04 per cent. Japan&#39;s Nikkei, however, rose 0.41 per cent and Shanghai Composite Index edged up 0.01 per cent.

European shares were down in their early deals. Frankfurt&#39;s DAX was down 0.77 per cent and Paris CAC 40 lost 0.76 per cent. London&#39;s FTSE too fell 0.18 per cent.

Markets nursed losses for the fourth straight session today as upbeat second-quarter GDP numbers failed to dispel concerns over a widening fiscal deficit

Markets nursed losses for the fourth straight session today as upbeat second-quarter GDP numbers failed to dispel concerns over a widening fiscal deficit. The BSE benchmark Sensex dived 316 points to close below the 33,000-mark, while the broader Nifty declined 104.75 points to 10,121.80. It was a forgettable week for both the key indices, with the Sensex recording a fall of 846.30 points, or 2.51 per cent and the NSE Nifty losing 267.90 points, or 2.57 per cent. "Despite data pointing to an improvement in the macro- economic environment, participants remained cautious and chose to sell stocks in the latter half of the trading day," said Karthikraj Lakshmanan, Senior Fund Manager, Equities, BNP Paribas Mutual Fund. The 30-share benchmark, after scaling a high of 33,300.81 in early deals, slipped into the negative zone to touch 32,797.78, before settling at 32,832.94, down 316.41 points, or 0.95 per cent. This was its weakest closing since November 15, when it had finished at 32,760.44. The 50-issue NSE Nifty too cracked the 10,200-mark and hit a low of 10,108.55 before finishing 104.75 points, or 1.02 per cent down at 10,121.80. Reversing a five-quarter slide in Gross Domestic Product (GDP) growth, the economy bounced back from a three-year low to expand by 6.3 per cent in July-September as manufacturing revved up and businesses adjusted to the new GST tax regime, data released after market hours yesterday showed. However, participants remained risk-averse as India's fiscal deficit at the end of October hit 96.1 per cent of the budget estimate for 2017-18, mainly due to lower revenue realisation and rise in expenditure. Meanwhile, foreign portfolio investors sold shares worth net Rs 1,500.76 crore, while domestic institutional investors (DIIs) bought shares to the tune of Rs 1,202.57 crore yesterday, as per provisional data. Small and mid-cap indices fell 1.16 per cent and 0.95 per cent in today's session, respectively. The session saw buying in select auto stocks such as Maruti Suzuki, TVS Motor and Ashok Leyland, buoyed by encouraging sales data for November. Among Sensex constituents, Adani Ports suffered the most by diving 3 per cent, followed by Bajaj Auto 2.99 per cent despite the company reporting a 21 per cent rise in total sales in November. Other big losers were Bharti Airtel (2.74 per cent), Sun Pharma (2.59 per cent), SBI (2.47 per cent), Dr Reddy's (2.44 per cent), Tata Steel (2.08 per cent), HUL (1.71 per cent), Infosys (1.69 per cent), Power Grid (1.51 per cent), Coal India (1.43 per cent), RIL (1.38 per cent), Tata Motors (1.36 per cent), HDFC LTD (1.11 per cent) and Hero MotoCorp (0.97 per cent). However, Kotak Bank rose 0.23 per cent followed by NTPC 0.14 per cent. Among BSE sectoral indices, realty dropped by 1.99 per cent followed by metal 1.75 per cent, infrastructure 1.63 per cent, oil & gas 1.47 per cent, PSU 1.46 per cent, teck 1.43 per cent, power 1.38 per cent, IT 1.29 per cent and auto 0.99 per cent. Globally, other Asian markets traded mixed after investors shifted nervously as US President Donald Trump's much-hyped tax-cut plans hung in the balance after a plan to push them through hit unexpected hurdles. Hong Kong's Hang Seng finished 0.35 per cent lower, while Korea fell 0.04 per cent. Japan's Nikkei, however, rose 0.41 per cent and Shanghai Composite Index edged up 0.01 per cent. European shares were down in their early deals. Frankfurt's DAX was down 0.77 per cent and Paris CAC 40 lost 0.76 per cent. London's FTSE too fell 0.18 per cent.

Sensex shrugs off GDP rebound, sinks 316 points

The BSE Sensex fell by 185 points in early session today due to losses in realty, power, PSU, metal and infrastructure stocks amid weak Asian cues.

Besides, investors were cautious ahead of September quarter GDP data to be released later in the day.

Offloading of positions by participants with today being the last trading session of November series contracts in the derivatives segment pulled down the index, brokers said.

The 30-share flagship index was down 185.24 points, or 0.55 per cent, at 33,417.52 with sectoral indices led by realty and power falling up to 0.88 per cent.

The gauge had fallen 121.68 points in the previous two sessions.

The 50-share NSE Nifty too was quoting lower by 57.50 points, or 0.55 per cent, at 10,303.80.

Weakness in the rupee, which slipped 24 paise to 64.55 against the dollar today, too weighed on the sentiments.

Among laggards Kotak Bank, Cipla, Adani Ports, ONGC, M&amp;M, Reliance Industries, Coal India, Axis Bank, Hind Unilever, Tata Motors, Bharti Airtel, HDFC Ltd, Tata Steel and Lupin dropped up to 1.71 per cent.

Hong Kong&#39;s Hang Seng weakened 1.21 per cent while Shanghai Composite lost 0.26 per cent in early trade. Japan&#39;s Nikkei too shed 0.10 per cent.

US Dow Jones Industrial Average ended 0.44 per cent higher yesterday.&nbsp;

The BSE Sensex fell by 185 points due to losses in realty, power, PSU, metal and infrastructure stocks

The BSE Sensex fell by 185 points in early session today due to losses in realty, power, PSU, metal and infrastructure stocks amid weak Asian cues. Besides, investors were cautious ahead of September quarter GDP data to be released later in the day. Offloading of positions by participants with today being the last trading session of November series contracts in the derivatives segment pulled down the index, brokers said. The 30-share flagship index was down 185.24 points, or 0.55 per cent, at 33,417.52 with sectoral indices led by realty and power falling up to 0.88 per cent. The gauge had fallen 121.68 points in the previous two sessions. The 50-share NSE Nifty too was quoting lower by 57.50 points, or 0.55 per cent, at 10,303.80. Weakness in the rupee, which slipped 24 paise to 64.55 against the dollar today, too weighed on the sentiments. Among laggards Kotak Bank, Cipla, Adani Ports, ONGC, M&M, Reliance Industries, Coal India, Axis Bank, Hind Unilever, Tata Motors, Bharti Airtel, HDFC Ltd, Tata Steel and Lupin dropped up to 1.71 per cent. Hong Kong's Hang Seng weakened 1.21 per cent while Shanghai Composite lost 0.26 per cent in early trade. Japan's Nikkei too shed 0.10 per cent. US Dow Jones Industrial Average ended 0.44 per cent higher yesterday.

Stocks fall ahead of GDP numbers, F&O expiry

The second-quarter Gross Domestic Product (GDP) figures are out. As per Central Statistics Office (CSO) data, the GDP snapped five quarters slide and in rebound of sorts claimbed to 6.3 per cent from a 3-year low of 5.7 per cent.

Former finance minister P Chidambaram tweeted that 6.3 per cent was far below the promise of the Modi government and far below the potential of a well-managed Indian economy.&nbsp;

Happy that the July-Sep quarter has registered a growth rate of 6.3%. This a PAUSE in the declining trend of the last five quarters, he tweeted.

&#39;6.3% is far below the PROMISE of the Modi government and far below the POTENTIAL of a well-managed Indian economy,&#39;&#39; he said and added &#39;&#39;We should wait for the growth rates over the next 3-4 quarters before we can reach a definite conclusion but we cannot say now whether this will mark an upward trend in the growth rate.&#39;&#39;

Meanwhile, West Bengal chief minister Mamata Banerjee tweeted last year Q2 GDP growth was 7.5% and this year it is 6.3%. This government only bhashan, no action.

&#39;GDP figures out. Again no growth. No jobs.Effects of note ban scam &amp; unplanned GST continue to damage the economy. Only talking. No performance,&#39;&#39; she added in another tweet.

Here are some of the reactions from the ruling party and the opposition:&nbsp;

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Today&rsquo;s GDP numbers reiterate the <a href="https://twitter.com/hashtag/IndiaUnstoppable?src=hash&amp;ref_src=twsrc%5Etfw">#IndiaUnstoppable</a> story under PM <a href="https://twitter.com/narendramodi?ref_src=twsrc%5Etfw">@narendramodi</a>. The strong rebound in growth is a reflection of solid economic management by the Modi Government.
&mdash; Amit Shah (@AmitShah) <a href="https://twitter.com/AmitShah/status/936216354067136512?ref_src=twsrc%5Etfw">November 30, 2017</a></blockquote>
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India&#39;s GDP growth rate shows upward trend in 2nd quarter of 2017-18 and registers a growth rate of 6.3%. This coupled with strong fundamentals hold promise for a great future of Indian economy under the leadership of <a href="https://twitter.com/PMOIndia?ref_src=twsrc%5Etfw">@PMOIndia</a> <a href="https://twitter.com/narendramodi?ref_src=twsrc%5Etfw">@narendramodi</a> <a href="https://twitter.com/hashtag/IndiaUnstoppable?src=hash&amp;ref_src=twsrc%5Etfw">#IndiaUnstoppable</a>
&mdash; Ravi Shankar Prasad (@rsprasad) <a href="https://twitter.com/rsprasad/status/936228391304306688?ref_src=twsrc%5Etfw">November 30, 2017</a></blockquote>
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Q2 FY 2017, GDP was 7.5%. Now it is 6.3%. Enough said. We are still in a deep abyss.
&mdash; Sanjay Jha (@JhaSanjay) <a href="https://twitter.com/JhaSanjay/status/936205278655270912?ref_src=twsrc%5Etfw">November 30, 2017</a></blockquote>
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Q2 GDP growth is an outcome of bold reforms such as GST &amp; DeMo, sound economic policies, prudent fiscal management, and overall development under the leadership of PM <a href="https://twitter.com/narendramodi?ref_src=twsrc%5Etfw">@narendramodi</a> ji. <a href="https://twitter.com/hashtag/IndiaUnstoppable?src=hash&amp;ref_src=twsrc%5Etfw">#IndiaUnstoppable</a>
&mdash; Manohar Parrikar (@manoharparrikar) <a href="https://twitter.com/manoharparrikar/status/936228928313626624?ref_src=twsrc%5Etfw">November 30, 2017</a></blockquote>
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West Bengal chief minister Mamata Banerjee tweeted last year Q2 GDP growth was 7.5% and this year it is 6.3%. This government only bhashan, no action.

The second-quarter Gross Domestic Product (GDP) figures are out. As per Central Statistics Office (CSO) data, the GDP snapped five quarters slide and in rebound of sorts claimbed to 6.3 per cent from a 3-year low of 5.7 per cent. Former finance minister P Chidambaram tweeted that 6.3 per cent was far below the promise of the Modi government and far below the potential of a well-managed Indian economy. Happy that the July-Sep quarter has registered a growth rate of 6.3%. This a PAUSE in the declining trend of the last five quarters, he tweeted. '6.3% is far below the PROMISE of the Modi government and far below the POTENTIAL of a well-managed Indian economy,'' he said and added ''We should wait for the growth rates over the next 3-4 quarters before we can reach a definite conclusion but we cannot say now whether this will mark an upward trend in the growth rate.'' Meanwhile, West Bengal chief minister Mamata Banerjee tweeted last year Q2 GDP growth was 7.5% and this year it is 6.3%. This government only bhashan, no action. 'GDP figures out. Again no growth. No jobs.Effects of note ban scam & unplanned GST continue to damage the economy. Only talking. No performance,'' she added in another tweet. Here are some of the reactions from the ruling party and the opposition: Today’s GDP numbers reiterate the #IndiaUnstoppable story under PM @narendramodi. The strong rebound in growth is a reflection of solid economic management by the Modi Government. — Amit Shah (@AmitShah) November 30, 2017 × India's GDP growth rate shows upward trend in 2nd quarter of 2017-18 and registers a growth rate of 6.3%. This coupled with strong fundamentals hold promise for a great future of Indian economy under the leadership of @PMOIndia @narendramodi #IndiaUnstoppable — Ravi Shankar Prasad (@rsprasad) November 30, 2017 × Q2 FY 2017, GDP was 7.5%. Now it is 6.3%. Enough said. We are still in a deep abyss. — Sanjay Jha (@JhaSanjay) November 30, 2017 × Q2 GDP growth is an outcome of bold reforms such as GST & DeMo, sound economic policies, prudent fiscal management, and overall development under the leadership of PM @narendramodi ji. #IndiaUnstoppable — Manohar Parrikar (@manoharparrikar) November 30, 2017 ×

Pause in declining trend of last five quarters: P Chidambaram on GDP

The Central Statistics Office (CSO) today released India&#39;s second-quarter Gross Domestic Product(GDP) figures pegging it at&nbsp;6.3 per cent for the second quarter in July to September period.

Major gains were seen in mining and manufacturing sectors.

&quot;GDP growth has recovered to 6.3% in Q2 from a 3-year low of 5.7% in Q1,&quot; TCA Anant, chief statistician said.

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Government&rsquo;s reforms to push economic growth are working can be seen from that manufacturing has shown robust growth of 7% in Q2 and services at 7.1%. Gross fixed capital formation has increased from 1.6% in Q1 to 4.7% in Q2.
&mdash; Arun Jaitley (@arunjaitley) <a href="https://twitter.com/arunjaitley/status/936221297297653760?ref_src=twsrc%5Etfw">November 30, 2017</a></blockquote>
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India&#39;s GDP figure was at a thirteen-quarter low at 5.7 for the period of April-June.

Earlier, India&#39;s finance minister Arun Jaitley speaking at a seminar had said achieving a 10 per cent GDP growth rate &quot;would be challenging&quot; and will depend on how the world is moving.

India intends to follow the glide path as far as the fiscal deficit, the finance minister had said.

NITI Aayog vice-chairman Rajiv Kumar had said Indian economy during July-September period is likely to grow at 6.2 to 6.3 per cent.&nbsp;

GDP is&nbsp;the value of all goods and services produced over a specific period and is one of the indicators of the health of an economy.

NITI Aayog vice-chairman Rajiv Kumar had said Indian economy during July-September period is likely to grow at 6.2 to 6.3 per cent

The Central Statistics Office (CSO) today released India's second-quarter Gross Domestic Product(GDP) figures pegging it at 6.3 per cent for the second quarter in July to September period. Major gains were seen in mining and manufacturing sectors. "GDP growth has recovered to 6.3% in Q2 from a 3-year low of 5.7% in Q1," TCA Anant, chief statistician said. Government’s reforms to push economic growth are working can be seen from that manufacturing has shown robust growth of 7% in Q2 and services at 7.1%. Gross fixed capital formation has increased from 1.6% in Q1 to 4.7% in Q2. — Arun Jaitley (@arunjaitley) November 30, 2017 × India's GDP figure was at a thirteen-quarter low at 5.7 for the period of April-June. Earlier, India's finance minister Arun Jaitley speaking at a seminar had said achieving a 10 per cent GDP growth rate "would be challenging" and will depend on how the world is moving. India intends to follow the glide path as far as the fiscal deficit, the finance minister had said. NITI Aayog vice-chairman Rajiv Kumar had said Indian economy during July-September period is likely to grow at 6.2 to 6.3 per cent. GDP is the value of all goods and services produced over a specific period and is one of the indicators of the health of an economy.

India's GDP climbs to 6.3 per cent in Q2, recovers from 3-year low

Lower taxes and higher public expenditure could widen budget deficit in 2017-18, but steps taken by the government to broaden the tax base and improve spending efficiency would help in narrowing it going forward, US-based rating agency Moody&#39;s said.

In an interview to PTI, Moody&#39;s Investors Service V-P (Sovereign Risk Group) William Foster said the agency believes that the government&#39;s commitment to fiscal consolidation remains and sustained growth would help it reduce the debt burden.

Moody&#39;s had last week raised India&#39;s sovereign rating for the first time in over 13 years, saying growth prospects have improved with continued progress on economic and institutional reforms. The rating was upgraded to Baa2 from Baa3 and rating outlook was changed to stable from positive.

Foster said the upgrade reflects the expectation that continued progress on economic and institutional reforms will enhance India&#39;s high growth potential and its large and stable financing base for government debt and will likely contribute to a gradual decline in the general government debt burden over the medium term.

India&#39;s debt-to-GDP ratio stood at 68.6 per cent and a government-appointed panel has recommended lowering it to 60 per cent by 2023.

&quot;We forecast the general government budget deficit at 6.5 per cent of GDP this fiscal year, similar to the last two fiscal years. Lower government revenues than planned in the Budget and somewhat higher government spending could lead to a deficit somewhat wider than targeted.

&quot;However, over time, measures aimed at broadening the tax base and improving the efficiency of government spending will contribute to a gradual narrowing of the deficit. Together with robust and sustained nominal GDP growth, this would be conducive to a gradual decline in the government debt burden,&quot; Foster said.

Foster, however, added that a material deterioration in fiscal metrics and the outlook for general government fiscal consolidation would put negative pressure on the rating.

General budget deficit includes expenditure incurred and revenue earned by both the Centre and states. &quot;The rating could also face downward pressure if the health of the banking system deteriorated significantly or external vulnerability increased sharply,&quot; he added.

The central government, in Budget 2017-18, had set a target of 3.2 per cent for fiscal deficit, which is the difference between the Centre&#39;s revenue and expenditure, for this fiscal. It would be brought down to 3 per cent next fiscal.

The finance ministry is scheduled to review the deficit target for the current financial year next month as it reassesses revenue mop-up from the recently launched Goods and Services Tax (GST) and PSU disinvestment programme.

The deficit has already touched 91.3 per cent of the target in the first half of the fiscal.

Projecting GDP growth to moderate to 6.7 per cent in the current fiscal, from 7.1 per cent last year, Moody&#39;s said while GST and demonetisation have undermined growth over the near term, growth will rise to 7.5 per cent in 2018-19 as the disruption fades.

According to Foster, the stable outlook denotes that Moody&#39;s does not expect a rating change in the foreseeable future. &quot;There are both positive and negative risks to the economy and India&#39;s credit profile,&quot; Foster added.

His assessment is a material strengthening in fiscal metrics, combined with a strong and durable recovery of the investment cycle, probably supported by significant economic and institutional reforms would be credit positive.

&quot;In particular, greater expectation of a sizeable and sustained reduction in the general government debt burden, through increased government revenues combined with a reduction in expenditures, would put positive pressure on the rating. Implementation of key pending reforms, including land and labour reforms, could put additional upward pressure on the rating,&quot; Foster said.&nbsp;

Moody's had last week raised India's sovereign rating for the first time in over 13 years, saying growth prospects have improved with continued progress on economic and institutional reforms

Lower taxes and higher public expenditure could widen budget deficit in 2017-18, but steps taken by the government to broaden the tax base and improve spending efficiency would help in narrowing it going forward, US-based rating agency Moody's said. In an interview to PTI, Moody's Investors Service V-P (Sovereign Risk Group) William Foster said the agency believes that the government's commitment to fiscal consolidation remains and sustained growth would help it reduce the debt burden. Moody's had last week raised India's sovereign rating for the first time in over 13 years, saying growth prospects have improved with continued progress on economic and institutional reforms. The rating was upgraded to Baa2 from Baa3 and rating outlook was changed to stable from positive. Foster said the upgrade reflects the expectation that continued progress on economic and institutional reforms will enhance India's high growth potential and its large and stable financing base for government debt and will likely contribute to a gradual decline in the general government debt burden over the medium term. India's debt-to-GDP ratio stood at 68.6 per cent and a government-appointed panel has recommended lowering it to 60 per cent by 2023. "We forecast the general government budget deficit at 6.5 per cent of GDP this fiscal year, similar to the last two fiscal years. Lower government revenues than planned in the Budget and somewhat higher government spending could lead to a deficit somewhat wider than targeted. "However, over time, measures aimed at broadening the tax base and improving the efficiency of government spending will contribute to a gradual narrowing of the deficit. Together with robust and sustained nominal GDP growth, this would be conducive to a gradual decline in the government debt burden," Foster said. Foster, however, added that a material deterioration in fiscal metrics and the outlook for general government fiscal consolidation would put negative pressure on the rating. General budget deficit includes expenditure incurred and revenue earned by both the Centre and states. "The rating could also face downward pressure if the health of the banking system deteriorated significantly or external vulnerability increased sharply," he added. The central government, in Budget 2017-18, had set a target of 3.2 per cent for fiscal deficit, which is the difference between the Centre's revenue and expenditure, for this fiscal. It would be brought down to 3 per cent next fiscal. The finance ministry is scheduled to review the deficit target for the current financial year next month as it reassesses revenue mop-up from the recently launched Goods and Services Tax (GST) and PSU disinvestment programme. The deficit has already touched 91.3 per cent of the target in the first half of the fiscal. Projecting GDP growth to moderate to 6.7 per cent in the current fiscal, from 7.1 per cent last year, Moody's said while GST and demonetisation have undermined growth over the near term, growth will rise to 7.5 per cent in 2018-19 as the disruption fades. According to Foster, the stable outlook denotes that Moody's does not expect a rating change in the foreseeable future. "There are both positive and negative risks to the economy and India's credit profile," Foster added. His assessment is a material strengthening in fiscal metrics, combined with a strong and durable recovery of the investment cycle, probably supported by significant economic and institutional reforms would be credit positive. "In particular, greater expectation of a sizeable and sustained reduction in the general government debt burden, through increased government revenues combined with a reduction in expenditures, would put positive pressure on the rating. Implementation of key pending reforms, including land and labour reforms, could put additional upward pressure on the rating," Foster said.

India's budget deficit may rise in FY18, but will improve in years ahead: Moody's

Japan&rsquo;s economy grew faster than expected in the third quarter due to strong exports, posting the longest period of uninterrupted growth in more than a decade.

The economy expanded at a 1.4 per cent annualized rate in July-September, slightly above the median estimate for annualized growth of 1.3 per cent, Cabinet Office data showed on Wednesday.

That followed the revised annualized growth of 2.6 per cent in April-June.

Consumer spending fell for the first time in seven quarters but this is expected to be temporary because the economy is near full employment, which should bolster domestic consumption in the future. Rising capital expenditure and exports are also expected to keep the economy growing, which should ease some concerns about sluggish inflation.

&ldquo;Japan&rsquo;s potential growth rate is around 1 per cent, so the results for the third quarter show the actual rate of growth is quite high,&rdquo; said Hidenobu Tokuda, senior economist at Mizuho Research Institute.

&ldquo;The jobs market is doing so well that consumer spending is sure to pick up in the future. Capital expenditure still looks healthy. The economy is doing well.&rdquo;

Gross domestic product (GDP) grew 0.3 per cent compared to the previous quarter, which matched the median estimate and followed a 0.6 per cent quarter-on-quarter expansion in April-June, Cabinet Office data showed on Wednesday.

The results show that Japan&rsquo;s economy has grown for the seventh straight quarter, the longest period of expansion since an eight-quarter run from April-June 1999 to January-March 2001.

External demand - or exports minus imports - was the biggest reason for expansion, adding 0.5 percent to growth.Shipments of cars and electronic parts to the United States and Asia were strong in the third quarter, reflecting improving global demand, a Cabinet Office official told reporters.

In comparison, negative external demand subtracted a revised 0.2 percentage point from GDP growth in April-June.

Private consumption, which accounts for about two-thirds of GDP, fell 0.5 per cent from the previous quarter, more than the median estimate of a 0.3 per cent contraction to mark the first decline since October-December 2015.

The decline was driven by lower spending at restaurants and hotels, as well as reduced spending on cars and mobile phones, the official said. Bad weather during the quarter may have hurt spending, the official said.

&ldquo;There&rsquo;s no change to our view the economy is recovering moderately as a trend,&rdquo; Japanese Economy Minister Toshimitsu Motegi told reporters.

&ldquo;We need to make the recovery a durable one, so we&rsquo;ll proceed with reforms to boost Japan&rsquo;s productivity.&rdquo;

Capital expenditure rose 0.2 per cent in July-September from the previous quarter, less than the median estimate for a 0.3 per cent increase but still up for the fourth straight quarter.

Capital Economics&rsquo; Senior Japan Economist Marcel Thielant said available data suggested that economic activity continued to expand in the current quarter, noting household incomes maintained solid growth and external demand was holding up.

&ldquo;However, the economy is running into capacity constraints which suggests that growth will start to slow next year. We reiterate our forecast that growth will moderate from 1.5 percent this year to 1 percent in 2019,&rdquo; he said.

Japan&rsquo;s government is due to announce a package of economic measures by year-end aimed at increasing investment in skills training and raising productivity.

This long run of growth should encourage the Bank of Japan to stick with the current monetary easing framework, given its argument that inflationary pressure will percolate through the economy as long as growth is on track.

The economy expanded at a 1.4 percent annualized rate in July-September, slightly above the median estimate for annualized growth of 1.3 percent, Cabinet Office data showed on Wednesday

Japan’s economy grew faster than expected in the third quarter due to strong exports, posting the longest period of uninterrupted growth in more than a decade. The economy expanded at a 1.4 per cent annualized rate in July-September, slightly above the median estimate for annualized growth of 1.3 per cent, Cabinet Office data showed on Wednesday. That followed the revised annualized growth of 2.6 per cent in April-June. Consumer spending fell for the first time in seven quarters but this is expected to be temporary because the economy is near full employment, which should bolster domestic consumption in the future. Rising capital expenditure and exports are also expected to keep the economy growing, which should ease some concerns about sluggish inflation. “Japan’s potential growth rate is around 1 per cent, so the results for the third quarter show the actual rate of growth is quite high,” said Hidenobu Tokuda, senior economist at Mizuho Research Institute. “The jobs market is doing so well that consumer spending is sure to pick up in the future. Capital expenditure still looks healthy. The economy is doing well.” Gross domestic product (GDP) grew 0.3 per cent compared to the previous quarter, which matched the median estimate and followed a 0.6 per cent quarter-on-quarter expansion in April-June, Cabinet Office data showed on Wednesday. The results show that Japan’s economy has grown for the seventh straight quarter, the longest period of expansion since an eight-quarter run from April-June 1999 to January-March 2001. External demand - or exports minus imports - was the biggest reason for expansion, adding 0.5 percent to growth.Shipments of cars and electronic parts to the United States and Asia were strong in the third quarter, reflecting improving global demand, a Cabinet Office official told reporters. In comparison, negative external demand subtracted a revised 0.2 percentage point from GDP growth in April-June. Private consumption, which accounts for about two-thirds of GDP, fell 0.5 per cent from the previous quarter, more than the median estimate of a 0.3 per cent contraction to mark the first decline since October-December 2015. The decline was driven by lower spending at restaurants and hotels, as well as reduced spending on cars and mobile phones, the official said. Bad weather during the quarter may have hurt spending, the official said. “There’s no change to our view the economy is recovering moderately as a trend,” Japanese Economy Minister Toshimitsu Motegi told reporters. “We need to make the recovery a durable one, so we’ll proceed with reforms to boost Japan’s productivity.” Capital expenditure rose 0.2 per cent in July-September from the previous quarter, less than the median estimate for a 0.3 per cent increase but still up for the fourth straight quarter. Capital Economics’ Senior Japan Economist Marcel Thielant said available data suggested that economic activity continued to expand in the current quarter, noting household incomes maintained solid growth and external demand was holding up. “However, the economy is running into capacity constraints which suggests that growth will start to slow next year. We reiterate our forecast that growth will moderate from 1.5 percent this year to 1 percent in 2019,” he said. Japan’s government is due to announce a package of economic measures by year-end aimed at increasing investment in skills training and raising productivity. This long run of growth should encourage the Bank of Japan to stick with the current monetary easing framework, given its argument that inflationary pressure will percolate through the economy as long as growth is on track.

Japan's GDP grows for seven straight quarters

The Indian economy is at a crossroads. The economic restructuring that began with the November 8 announcement of demonetisation, now faces the risk of being derailed by parties with vested interests. The process of demonetisation and the implementation of the Goods and Services Tax are important economic disruptions that can go a long way in overhauling the dilapidated structures of Indian economy.

Critics have suggested that demonetisation could not achieve its declared goal and are, therefore, quick to pronounce it as a monumental failure. The former prime minister even went to the extent of calling the process a &#39;legalised plunder&#39;. It is, however, important to highlight why demonetisation was a critically important disruption that unveiled the depths of the black economy in India.

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<h5>Post-demonetisation, one of the major successes of the exercise has been the identification of additional 56 lakh taxpayers who filed e-ITRs between 1 April and 5 August 2017</h5>
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Post-demonetisation, one of the major successes of the exercise has been the identification of additional 56 lakh taxpayers who filed e-ITRs between 1 April and 5 August 2017, while for the entire period of 2016-17, a staggering 91 lakh new taxpayers were added to the list. The number is expected to rise further with the implementation of complementary tax reforms. An estimated one crore new taxpayers will be contributing to the country&#39;s kitty by 2018.

For those who questioned the rationale of the process on the grounds that 99 per cent of the money came back into the system, it becomes important to highlight that while this may have gone against the government&#39;s initial calculations, the return of currency into the system was not as big a failure as is being made out. On the contrary, as previously unaccounted for money was deposited into the system, a large part of it was taxed, making major contributions to the government&#39;s kitty. The currency trail was, therefore, significant in the identification of the aforementioned pool of new taxpayers, who remained previously untaxed.

The exercise also helped in identifying a remarkable 3 lakh shell companies that were used for diverting funds and committing tax frauds. A crackdown on such companies was an effective anti-money laundering steps that was made possible by the currency trail identified post-demonetisation. While the usual narrative against the exercise uses the benchmark of &ldquo;99% cash returned&rdquo; to chastise the government, the actual benefits accrued from the disruption are brushed aside.

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<h5>The GST helped widen the government&#39;s tax net to incorporate the previously un-taxed business enterprises.</h5>
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8 months after demonetisation, the implementation of the GST as an indirect tax reform measure is another very important economic reform taken by the government. The GST helped widen the government&#39;s tax net to incorporate the previously un-taxed business enterprises. The self-corrective mechanisms incorporated in the GST structure, namely, the input tax credits against double taxation helps squeeze the noose around those who used to pass the tax burden onto the customers/consumers but did not pass on the benefits to the government.

Not only has the implementation of the GST acted as a stepping stone towards the creation of a unified market structure, it has also helped the government identify direct taxpayers. It has expanded the indirect tax base to 6.6 lakh new business agents, previously outside the tax net. Besides, the GST has helped in a greater formalisation of the economy; a process that will ensure minimum wages for workers as well as formal work contracts for labourers that will go a long way in mitigating the evil of labour exploitation.&nbsp;

A greater formalisation of the economy will also help small businessmen keep a real-time record of their tax payments, and help them gain greater access to formalised credit options, thus, ending a previously faced constraint on credit-access. A digital record on the financial health of companies will also streamline investments and ultimately work to the benefit of consumers.

It is no surprise then that through the implementation of demonetisation and GST, within a year the government has announced three major capital-intensive schemes: the Saubhagya scheme to provide last mile electric connectivity to rural households, the Bharatmala scheme to upgrade the infrastructure of the country on a mission mode basis, and the bank recapitalisation scheme to improve the health of ailing public sector banks. While none of these schemes are &#39;populist&#39; in the true sense, they still cater to the needs of those on the lowest rung of our socio-economic ladder.

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<h5>The government&#39;s emphasis on long-term economic reforms and socio-economic restructuring will go a long way in ushering in the idea of clean money.</h5>
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To further deepen and widen its tax net, the government now must address the issue of high rates of taxes and bring them down to further encourage a voluntary filing of tax returns. The GST structures will need to be worked out so that filing of returns can be done effectively and easily. The government must be credited for putting a robust feedback mechanism in place. This must be used pro-actively to streamline the financial system by the end of this financial year.

For the rest, it must be remembered that no country can survive on an economic model that rests on a parallel system of white and black money. The unhindered flow from white-to-black-to-white has worked to hollow out our economic system. The government&#39;s emphasis on long-term economic reforms and socio-economic restructuring will go a long way in ushering in the idea of clean money. It has also instilled fear among those who choose to evade taxation and boost the morale of those who sustain on purely white incomes. This in itself, is an important moral victory for many.

Demonetisation has instilled fear among those who choose to evade taxation and boost the morale of those who sustain on purely white incomes

The Indian economy is at a crossroads. The economic restructuring that began with the November 8 announcement of demonetisation, now faces the risk of being derailed by parties with vested interests. The process of demonetisation and the implementation of the Goods and Services Tax are important economic disruptions that can go a long way in overhauling the dilapidated structures of Indian economy. Critics have suggested that demonetisation could not achieve its declared goal and are, therefore, quick to pronounce it as a monumental failure. The former prime minister even went to the extent of calling the process a 'legalised plunder'. It is, however, important to highlight why demonetisation was a critically important disruption that unveiled the depths of the black economy in India. Post-demonetisation, one of the major successes of the exercise has been the identification of additional 56 lakh taxpayers who filed e-ITRs between 1 April and 5 August 2017 × Post-demonetisation, one of the major successes of the exercise has been the identification of additional 56 lakh taxpayers who filed e-ITRs between 1 April and 5 August 2017, while for the entire period of 2016-17, a staggering 91 lakh new taxpayers were added to the list. The number is expected to rise further with the implementation of complementary tax reforms. An estimated one crore new taxpayers will be contributing to the country's kitty by 2018. For those who questioned the rationale of the process on the grounds that 99 per cent of the money came back into the system, it becomes important to highlight that while this may have gone against the government's initial calculations, the return of currency into the system was not as big a failure as is being made out. On the contrary, as previously unaccounted for money was deposited into the system, a large part of it was taxed, making major contributions to the government's kitty. The currency trail was, therefore, significant in the identification of the aforementioned pool of new taxpayers, who remained previously untaxed. The exercise also helped in identifying a remarkable 3 lakh shell companies that were used for diverting funds and committing tax frauds. A crackdown on such companies was an effective anti-money laundering steps that was made possible by the currency trail identified post-demonetisation. While the usual narrative against the exercise uses the benchmark of “99% cash returned” to chastise the government, the actual benefits accrued from the disruption are brushed aside. The GST helped widen the government's tax net to incorporate the previously un-taxed business enterprises. × 8 months after demonetisation, the implementation of the GST as an indirect tax reform measure is another very important economic reform taken by the government. The GST helped widen the government's tax net to incorporate the previously un-taxed business enterprises. The self-corrective mechanisms incorporated in the GST structure, namely, the input tax credits against double taxation helps squeeze the noose around those who used to pass the tax burden onto the customers/consumers but did not pass on the benefits to the government. Not only has the implementation of the GST acted as a stepping stone towards the creation of a unified market structure, it has also helped the government identify direct taxpayers. It has expanded the indirect tax base to 6.6 lakh new business agents, previously outside the tax net. Besides, the GST has helped in a greater formalisation of the economy; a process that will ensure minimum wages for workers as well as formal work contracts for labourers that will go a long way in mitigating the evil of labour exploitation. A greater formalisation of the economy will also help small businessmen keep a real-time record of their tax payments, and help them gain greater access to formalised credit options, thus, ending a previously faced constraint on credit-access. A digital record on the financial health of companies will also streamline investments and ultimately work to the benefit of consumers. It is no surprise then that through the implementation of demonetisation and GST, within a year the government has announced three major capital-intensive schemes: the Saubhagya scheme to provide last mile electric connectivity to rural households, the Bharatmala scheme to upgrade the infrastructure of the country on a mission mode basis, and the bank recapitalisation scheme to improve the health of ailing public sector banks. While none of these schemes are 'populist' in the true sense, they still cater to the needs of those on the lowest rung of our socio-economic ladder. The government's emphasis on long-term economic reforms and socio-economic restructuring will go a long way in ushering in the idea of clean money. × To further deepen and widen its tax net, the government now must address the issue of high rates of taxes and bring them down to further encourage a voluntary filing of tax returns. The GST structures will need to be worked out so that filing of returns can be done effectively and easily. The government must be credited for putting a robust feedback mechanism in place. This must be used pro-actively to streamline the financial system by the end of this financial year. For the rest, it must be remembered that no country can survive on an economic model that rests on a parallel system of white and black money. The unhindered flow from white-to-black-to-white has worked to hollow out our economic system. The government's emphasis on long-term economic reforms and socio-economic restructuring will go a long way in ushering in the idea of clean money. It has also instilled fear among those who choose to evade taxation and boost the morale of those who sustain on purely white incomes. This in itself, is an important moral victory for many.

Demonetisation and GST are not the 'demons' as some argue

Finance Minister Arun Jaitley said on Wednesday that the<a href="http://www.wionews.com/business-economy/india-q1-economic-growth-slips-to-57-19725"> slowdown in India&#39;s GDP growth in the first quarter</a> to 5.7 per cent was a matter of concern.

&quot;It is certainly a matter of concern that first quarter GDP has come down to 5.7 per cent and it&#39;s obvious therefore that it throws a challenge for the economy,&quot; the finance minister said.

He said there was a requirement to improve policy and investment to improve upon these figures.

The finance minister attributed the de-stocking of inventories by the industry in anticipation of the Goods and Services Tax (GST)&nbsp;for an increase in sales and the reduction in manufacturing.

&quot;That manufacturing has fallen is essentially due to the anticipatory impact of GST. Since it came in July, most manufacturers were de-stocking,&quot; he said, noting that services growth had, however, improved during the quarter in question.

&quot;De-stocking of the manufacturing sector seems to have been completed, so the dip in manufacturing could be bottoming out from this quarter,&quot; he said.

&quot;Gross fixed capital ratio turned positive, investment improved...services improved,&quot; during the first quarter, he added.&nbsp;

The finance minister attributed the roll-out of the GST for the &quot;contradiction between services improving and manufacturing going down.&quot;

He said he was optimistic that the &quot;curve could turn for the better&quot; once GST was implemented.

The finance minister attributed the de-stocking of inventories by the industry in anticipation of the GST for an increase in trading and sales and the reduction in manufacturing.

Finance Minister Arun Jaitley said on Wednesday that the slowdown in India's GDP growth in the first quarter to 5.7 per cent was a matter of concern. "It is certainly a matter of concern that first quarter GDP has come down to 5.7 per cent and it's obvious therefore that it throws a challenge for the economy," the finance minister said. He said there was a requirement to improve policy and investment to improve upon these figures. The finance minister attributed the de-stocking of inventories by the industry in anticipation of the Goods and Services Tax (GST) for an increase in sales and the reduction in manufacturing. "That manufacturing has fallen is essentially due to the anticipatory impact of GST. Since it came in July, most manufacturers were de-stocking," he said, noting that services growth had, however, improved during the quarter in question. "De-stocking of the manufacturing sector seems to have been completed, so the dip in manufacturing could be bottoming out from this quarter," he said. "Gross fixed capital ratio turned positive, investment improved...services improved," during the first quarter, he added. The finance minister attributed the roll-out of the GST for the "contradiction between services improving and manufacturing going down." He said he was optimistic that the "curve could turn for the better" once GST was implemented.

Slowdown in GDP matter of concern: Arun Jaitley

The term &ldquo;jobless growth&rdquo;, much in the news these days, is used to describe the phenomenon of GDP growth without a commensurate increase in (formal) employment. How can GDP grow without job creation? The increasing use of machines in production is one crucial reason.&nbsp;

Annual Survey of Industries data, which reports on organised or formal sector firms, shows that the capital to labour ratio has steadily risen in most industries over the past few decades. In a country like India, where labour is abundant and cheap, why are firms choosing to substitute capital (machines) for labour? Several explanations have been offered, none of them exclusive of the others.

One story, popular among some economists as well as policy-makers is that India&rsquo;s labour laws are too restrictive. Faced with an excessive regulation of hiring and firing, firms prefer to substitute machines for workers. A vigorous debate has raged over this issue. Although a consensus of sorts seems to be forming in the policy circles that labour laws are a big constraint on job creation, and several steps have already been taken at the centre and state level to dilute these laws, two things are worth noting. First, firm owners often do not list labour laws among the top two or three constraints that they face in expanding their business. Rather inadequate infrastructure, government procedures, and weak demand top the list.&nbsp;

To put it another way, if strong demand were assured and infrastructure streamlined, then labour laws would be unlikely to get in the way of firm expansion. Second, if firms really wanted to expand while avoiding being subject to labour laws, we should observe a large number of firms employing workers up to just below the threshold where labour laws kick in. But we observe no such &ldquo;clumping.&rdquo;

Of course, it is possible that firms do not face this constraint simply because they hire informal (off the books) workers via contractors. This way expansion is assured without being subject to labour laws. Indeed, the data clearly show an increasing presence of informal workers within formal sector firms. But the solution to this proliferation of precarious jobs is actually to make sure these jobs get formalised and come under the ambit of regulation. And not to remove regulation on existing formal jobs. What is needed is an intelligent approach that strengthens those regulations that will improve job security, working conditions, and rights to bargain collectively, while allowing firms the flexibility to shed labour after meeting due obligations and safeguards.

The second explanation for increasing mechanisation draws on the fact that in recent decades, the Indian economy has become increasingly more integrated into the global economy. Trade liberalisation makes the import of capital and intermediate goods easier. Imported capital goods are relatively cheaper and this reduces the relative price of capital vis-a-vis labour, inducing firms to substitute capital for labour. Trade liberalisation also forced domestic firms to compete with foreign firms in the domestic market. Since foreign firms bring in products produced with much more capital-intensive technology and lower unit costs (because they often operate in capital-rich, labour-scarce economies), domestic firms also have to adopt that technology to stay competitive. And finally, trade liberalisation allows Indian firms to access foreign markets, where again they have to compete with firms producing with capital-intensive technology.

A third explanation is that growth in the post-reform period has benefited a narrow class of Indians, thereby, increasing inequality. Hence expenditure by the elite has become an important source of demand for domestic manufacturers. This elite demand is skewed towards products, such as automobiles, electronics, white goods, higher-end services etc. which are produced by capital-intensive and not labour-intensive technology as it is done in sectors producing food and clothing etc. So a growth in elite demand, raises GDP but does not create jobs.

All this has serious implications for the &ldquo;normal&rdquo; way in which other countries historically managed to create employment, through increasing manufacturing activities. It is not available anymore because countries that are expanding their industrial and manufacturing base today have to compete with much more advanced countries in the same market. As a result, in many developing countries, manufacturing share of employment is declining instead of growing. Workers are moving directly from agriculture into services. This has been called &ldquo;premature deindustrialization.&rdquo;

Finally, at the ideological level, governments in countries like India have willingly constrained themselves. They have not adopted strategic trade and industrial policies for fear of being labeled &ldquo;protectionist,&rdquo; &ldquo;anti-market&rdquo;, &ldquo;anti-investor&rdquo;, anti-globalisation&rdquo; etc. In fact, a large economy like India should have significant leeway in policy-making to suit its own priorities. After all the true test of a well-functioning economy is whether it makes life better for all its citizens, not whether it is open and global.

Increasing uses of informal workers, rising demands of elites and a globalised economy are keeping Indians jobless.

The term “jobless growth”, much in the news these days, is used to describe the phenomenon of GDP growth without a commensurate increase in (formal) employment. How can GDP grow without job creation? The increasing use of machines in production is one crucial reason. Annual Survey of Industries data, which reports on organised or formal sector firms, shows that the capital to labour ratio has steadily risen in most industries over the past few decades. In a country like India, where labour is abundant and cheap, why are firms choosing to substitute capital (machines) for labour? Several explanations have been offered, none of them exclusive of the others. One story, popular among some economists as well as policy-makers is that India’s labour laws are too restrictive. Faced with an excessive regulation of hiring and firing, firms prefer to substitute machines for workers. A vigorous debate has raged over this issue. Although a consensus of sorts seems to be forming in the policy circles that labour laws are a big constraint on job creation, and several steps have already been taken at the centre and state level to dilute these laws, two things are worth noting. First, firm owners often do not list labour laws among the top two or three constraints that they face in expanding their business. Rather inadequate infrastructure, government procedures, and weak demand top the list. To put it another way, if strong demand were assured and infrastructure streamlined, then labour laws would be unlikely to get in the way of firm expansion. Second, if firms really wanted to expand while avoiding being subject to labour laws, we should observe a large number of firms employing workers up to just below the threshold where labour laws kick in. But we observe no such “clumping.” Of course, it is possible that firms do not face this constraint simply because they hire informal (off the books) workers via contractors. This way expansion is assured without being subject to labour laws. Indeed, the data clearly show an increasing presence of informal workers within formal sector firms. But the solution to this proliferation of precarious jobs is actually to make sure these jobs get formalised and come under the ambit of regulation. And not to remove regulation on existing formal jobs. What is needed is an intelligent approach that strengthens those regulations that will improve job security, working conditions, and rights to bargain collectively, while allowing firms the flexibility to shed labour after meeting due obligations and safeguards. The second explanation for increasing mechanisation draws on the fact that in recent decades, the Indian economy has become increasingly more integrated into the global economy. Trade liberalisation makes the import of capital and intermediate goods easier. Imported capital goods are relatively cheaper and this reduces the relative price of capital vis-a-vis labour, inducing firms to substitute capital for labour. Trade liberalisation also forced domestic firms to compete with foreign firms in the domestic market. Since foreign firms bring in products produced with much more capital-intensive technology and lower unit costs (because they often operate in capital-rich, labour-scarce economies), domestic firms also have to adopt that technology to stay competitive. And finally, trade liberalisation allows Indian firms to access foreign markets, where again they have to compete with firms producing with capital-intensive technology. A third explanation is that growth in the post-reform period has benefited a narrow class of Indians, thereby, increasing inequality. Hence expenditure by the elite has become an important source of demand for domestic manufacturers. This elite demand is skewed towards products, such as automobiles, electronics, white goods, higher-end services etc. which are produced by capital-intensive and not labour-intensive technology as it is done in sectors producing food and clothing etc. So a growth in elite demand, raises GDP but does not create jobs. All this has serious implications for the “normal” way in which other countries historically managed to create employment, through increasing manufacturing activities. It is not available anymore because countries that are expanding their industrial and manufacturing base today have to compete with much more advanced countries in the same market. As a result, in many developing countries, manufacturing share of employment is declining instead of growing. Workers are moving directly from agriculture into services. This has been called “premature deindustrialization.” Finally, at the ideological level, governments in countries like India have willingly constrained themselves. They have not adopted strategic trade and industrial policies for fear of being labeled “protectionist,” “anti-market”, “anti-investor”, anti-globalisation” etc. In fact, a large economy like India should have significant leeway in policy-making to suit its own priorities. After all the true test of a well-functioning economy is whether it makes life better for all its citizens, not whether it is open and global.

Why is India's growth not creating more jobs?

The Indian government on Friday forecast a slowdown in the country&#39;s GDP growth to to 7.1 per cent in 2016-17, from 7.6 per cent last year. The government data released today attributed the lower growth rate mainly to a slump in manufacturing, mining and construction sectors.

In a break from departure, the estimates are based on data of seven months till October without taking into account &quot;volatile&quot; figures post post-demonetisation in the months of November and December.

Chief Statistician TCA Anant, who released the data compiled by the Central Statistics Office (CSO), said the figures for November were available and examined but &quot;it was felt in view of the policy of denotification of notes there is a high degree of volatility in these figures and conscious decision was taken not make projection using the November figures.&quot;

&quot;The growth in GDP during 2016-17 is estimated at 7.1 per cent as compared to the growth rate of 7.6 per cent in 2015- 16,&quot; the CSO said.&nbsp;

As per the data, the per capita net national income (current prices) during 2016-17 is estimated to be Rs 1,03,007 &mdash; a &nbsp;rise of 10.4 per cent as compared to Rs 93,293 during 2015-16 with the growth rate of 7.4 per cent.&nbsp;

Until last year, the government&#39;s statisticians would wait for GDP data for the quarter through December before putting out full-year estimates. This year December quarter figures will not be available before the end of February, making the projection largely reliant on the economy&#39;s performance in the period before demonetisation, when consumer demand was strong, Reuters reported.

The CSO will release the demonetisation data on February 28, along with revised full-year growth estimates.

&#39;Agriculture, forestry and fishing&#39; is expected to grow by 4.1 per cent in 2016-17 from 1.2 per cent last fiscal, PTI reported citing data released by the government. Mining and quarrying is likely to contract by 1.8 per cent after growing at 7.4 per cent in 2015-16. Growth in manufacturing is expected to slow to 7.4 per cent (from 9.3 per cent) and construction activities to 2.9 per cent (from 3.9 per cent).

Real GDP or Gross Domestic Product (GDP) at constant (2011-12) prices in the year 2016-17 is likely to attain a level of Rs 121.55 lakh crore, as against the Provisional Estimate of GDP for the year 2015-16 of Rs 113.50 lakh crore, released May 31, 2016.

The CSO also said projections on national income are now in line with estimates of India&#39;s central bank, Reserve Bank of India, which too has lowered the GDP growth prospects to 7.1 per cent. &quot;Anticipated growth of real &nbsp;Gross Value Added (GVA) at basic prices in 2016-17 is 7 per cent against 7.2 per cent in 2015-16,&quot; the CSO said.

In value terms, the (GVA) at constant prices is anticipated to increase from Rs 104.27 lakh crore in 2015-16 to Rs 111.53 lakh crore in 2016-17.

Private economists&#39; projections&nbsp;at 6.3-6.4%

Most private economists have pegged India&#39;s growth forecast to 6.3 per cent to 6.4 per cent for 2016-17 fiscal year, citing the impact of the demonetisation, Reuters reports. They estimate that the impact of demonetisation of Rs 500 and Rs 1000 notes, which came into effect from November 8, would linger for one more year.

Aneesh srivastava, chief investment officer, IDBI Federal Life Insurance company told Reuters, &quot;I am very worried with the projected growth rate. The methodology followed excludes demonetisation, but still the projected rate of 7.1 per cent is below my estimate of 7.5 per cent.

&quot;Take demonetisation into account, the rate will substantially drop. My estimates taking demonetisation into account was 6.8 percent, but now it will much lesser than that, he added.&quot;

&quot;Since the dollar is strengthening and global dynamics are not in our favour, I expect RBI to cut rate by 25 bps as early as February.&quot;&nbsp;

Varun Khandelwal, managing director, Bullero Capital, told Reuters, &quot;Based on statistical measures, it is very difficult to factor in the impact on demonetisation. Mostly the impact of demonetisation will be proportionally higher in micro, smaller and medium scale enterprises.

&quot;For FY17 our growth estimate range is lower at 5.5-6.5 per cent and this will depend on the future course of policy actions, the time taken for cash to come back into the system and what kind of budget we have.&quot; 
Friday&#39;s GDP estimate is a vital input for Finance Minister Arun Jaitley&#39;s budget on February 1.&nbsp;

(WION with inputs from agencies)

 
&nbsp;

The growth rate has slowed down from 7.6% a year earlier. The data does not take into account the post-demonetisation figures

The Indian government on Friday forecast a slowdown in the country's GDP growth to to 7.1 per cent in 2016-17, from 7.6 per cent last year. The government data released today attributed the lower growth rate mainly to a slump in manufacturing, mining and construction sectors. In a break from departure, the estimates are based on data of seven months till October without taking into account "volatile" figures post post-demonetisation in the months of November and December. Chief Statistician TCA Anant, who released the data compiled by the Central Statistics Office (CSO), said the figures for November were available and examined but "it was felt in view of the policy of denotification of notes there is a high degree of volatility in these figures and conscious decision was taken not make projection using the November figures." "The growth in GDP during 2016-17 is estimated at 7.1 per cent as compared to the growth rate of 7.6 per cent in 2015- 16," the CSO said. As per the data, the per capita net national income (current prices) during 2016-17 is estimated to be Rs 1,03,007 — a rise of 10.4 per cent as compared to Rs 93,293 during 2015-16 with the growth rate of 7.4 per cent. Until last year, the government's statisticians would wait for GDP data for the quarter through December before putting out full-year estimates. This year December quarter figures will not be available before the end of February, making the projection largely reliant on the economy's performance in the period before demonetisation, when consumer demand was strong, Reuters reported. The CSO will release the demonetisation data on February 28, along with revised full-year growth estimates. 'Agriculture, forestry and fishing' is expected to grow by 4.1 per cent in 2016-17 from 1.2 per cent last fiscal, PTI reported citing data released by the government. Mining and quarrying is likely to contract by 1.8 per cent after growing at 7.4 per cent in 2015-16. Growth in manufacturing is expected to slow to 7.4 per cent (from 9.3 per cent) and construction activities to 2.9 per cent (from 3.9 per cent). Real GDP or Gross Domestic Product (GDP) at constant (2011-12) prices in the year 2016-17 is likely to attain a level of Rs 121.55 lakh crore, as against the Provisional Estimate of GDP for the year 2015-16 of Rs 113.50 lakh crore, released May 31, 2016. The CSO also said projections on national income are now in line with estimates of India's central bank, Reserve Bank of India, which too has lowered the GDP growth prospects to 7.1 per cent. "Anticipated growth of real Gross Value Added (GVA) at basic prices in 2016-17 is 7 per cent against 7.2 per cent in 2015-16," the CSO said. In value terms, the (GVA) at constant prices is anticipated to increase from Rs 104.27 lakh crore in 2015-16 to Rs 111.53 lakh crore in 2016-17. Private economists' projections at 6.3-6.4% Most private economists have pegged India's growth forecast to 6.3 per cent to 6.4 per cent for 2016-17 fiscal year, citing the impact of the demonetisation, Reuters reports. They estimate that the impact of demonetisation of Rs 500 and Rs 1000 notes, which came into effect from November 8, would linger for one more year. Aneesh srivastava, chief investment officer, IDBI Federal Life Insurance company told Reuters, "I am very worried with the projected growth rate. The methodology followed excludes demonetisation, but still the projected rate of 7.1 per cent is below my estimate of 7.5 per cent. "Take demonetisation into account, the rate will substantially drop. My estimates taking demonetisation into account was 6.8 percent, but now it will much lesser than that, he added." "Since the dollar is strengthening and global dynamics are not in our favour, I expect RBI to cut rate by 25 bps as early as February." Varun Khandelwal, managing director, Bullero Capital, told Reuters, "Based on statistical measures, it is very difficult to factor in the impact on demonetisation. Mostly the impact of demonetisation will be proportionally higher in micro, smaller and medium scale enterprises. "For FY17 our growth estimate range is lower at 5.5-6.5 per cent and this will depend on the future course of policy actions, the time taken for cash to come back into the system and what kind of budget we have." Friday's GDP estimate is a vital input for Finance Minister Arun Jaitley's budget on February 1. (WION with inputs from agencies)

Indian government forecasts lower growth rate of 7.1% in 2016-17

India remained the fastest growing major economy with its GDP accelerating to 7.3 per cent in the September quarter, pushed mainly by farm output, although the momentum may be hit in the coming months by the impact of demonetisation.

The Gross Domestic Product (GDP) or national income which rose from 7.1 per cent in the previous quarter is, however, lower than 7.6 per cent recorded in the same period last year.

India overtook China in economic growth rate in 2015, and continues to be the world&#39;s fastest growing large economy.

Meanwhile, monthly macro-economic data on performance of eight infrastructure sectors showed six-month high growth of 6.6 per cent in October.

According to the data released today by the Central Statistics Office (CSO), the Gross Value Added (GVA), which is estimated at the basic price, growth decelerated to 7.1 per cent as compared 7.3 per cent both in the previous as well as the year ago period.

The data revealed that over 7 per cent growth was recorded by &#39;public administration, defence and other services&#39;, &#39;financial, insurance, real estate and professional services&#39;, &#39;manufacturing&#39; and &#39;trade, hotels and transport and communication and services related to broadcasting&#39;.

Growth rates in agriculture, forestry and fishing; mining and quarrying; electricity, gas, water supply and other utility services; and construction were at 3.3 per cent, (-)1.5 per cent, 3.5 per cent and 3.5 per cent respectively. This compares with 2 per cent, 5 per cent, 7.5 per cent and 0.8 per cent year ago period.

Manufacturing slowed to 7.1 per cent from 9.2 per cent in the year-ago period. On the impact of demonetisation of old Rs 500/1000 notes on growth prospects, Chief Statistician T C A Anant said statements made by experts on the adverse impact of demonetisation is made without any data.

&quot;People make assumptions and based on that they make statements. Once the data comes in, I will make a statement,&quot; he said at a press conference.

Chief Economic Adviser Arvind Subramanian said: &quot;What we have for first half are actual numbers. It shows good consistent performance. For second half we will have to see, there are a lot of uncertainties. We have to analyse it before we say something&quot;.

What is worrying, however, is the decline in Gross Fixed Capital Formation (GFCF) an indicator of investment.

GFCF growth rates at current and constant prices are estimated at (-)3.2 per cent and (-)5.6 per cent during Q2 of 2016-17 as compared to 7.5 per cent and 9.7 per cent during Q2 of 2015-16.&nbsp;

Talking about challenges, Subramanian said investment was down substantially in the second quarter and that is something that needs to be watched.

Referring to the impact of demonetisation of 500 and 1000 rupee notes by the government earlier this month, CII Director General Chandrajit Banerjee said that it would be a &quot;temporary setback&quot; to growth in the coming quarter.

As per CSO, GDP at constant (2011-12) prices in the second quarter of 2016-17 is estimated at Rs 29.63 lakh crore, as against Rs 27.62 lakh crore in the year-ago period.

The quarterly GVA at basic price at constant (2011-12) prices for July-September is estimated at Rs 27.33 lakh crore, as against Rs 25.52 lakh crore year-on-year.

Government Final Consumption Expenditure (GFCE) at current prices is estimated at Rs 5.15 lakh crore for the second quarter as against Rs 4.27 lakh crore year ago.

At constant (2011-2012) prices, the GFCE is estimated at Rs 3.84 lakh crore as against Rs 3.33 lakh crore.

In terms of GDP, the rates of GFCE at current and constant prices during the second quarter are estimated at 14.1 per cent and 13 per cent respectively, as against the corresponding rate of 13.1 per cent and 12.1 per cent in the same period of 2015-16.

Chief Statistician Anant also informed that the &#39;advance estimates&#39; for national accounts data for the current fiscal will be released on January 7, a month in advance.

The data release date is being advanced as government would be presenting the annual budget a month ahead of the usual practice of unveiling it on last working day of February.

The data on eight core infrastructure sectors recorded a growth rate of 6.6 per cent in October on the back of impressive performance by steel and refinery products.

However, growth rate of power generation, fertiliser production and cement output fell considerably on a year-on-year basis. Coal production continued to fall for the third straight month.

The core infrastructure sectors -- coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity -- showed 3.8 per cent in October last year.

Core sector contributes 38 per cent to the total industrial production. 
 
(PTI)

The GDP was, however, lower than 7.6 per cent recorded in the same period last year.

India remained the fastest growing major economy with its GDP accelerating to 7.3 per cent in the September quarter, pushed mainly by farm output, although the momentum may be hit in the coming months by the impact of demonetisation. The Gross Domestic Product (GDP) or national income which rose from 7.1 per cent in the previous quarter is, however, lower than 7.6 per cent recorded in the same period last year. India overtook China in economic growth rate in 2015, and continues to be the world's fastest growing large economy. Meanwhile, monthly macro-economic data on performance of eight infrastructure sectors showed six-month high growth of 6.6 per cent in October. According to the data released today by the Central Statistics Office (CSO), the Gross Value Added (GVA), which is estimated at the basic price, growth decelerated to 7.1 per cent as compared 7.3 per cent both in the previous as well as the year ago period. The data revealed that over 7 per cent growth was recorded by 'public administration, defence and other services', 'financial, insurance, real estate and professional services', 'manufacturing' and 'trade, hotels and transport and communication and services related to broadcasting'. Growth rates in agriculture, forestry and fishing; mining and quarrying; electricity, gas, water supply and other utility services; and construction were at 3.3 per cent, (-)1.5 per cent, 3.5 per cent and 3.5 per cent respectively. This compares with 2 per cent, 5 per cent, 7.5 per cent and 0.8 per cent year ago period. Manufacturing slowed to 7.1 per cent from 9.2 per cent in the year-ago period. On the impact of demonetisation of old Rs 500/1000 notes on growth prospects, Chief Statistician T C A Anant said statements made by experts on the adverse impact of demonetisation is made without any data. "People make assumptions and based on that they make statements. Once the data comes in, I will make a statement," he said at a press conference. Chief Economic Adviser Arvind Subramanian said: "What we have for first half are actual numbers. It shows good consistent performance. For second half we will have to see, there are a lot of uncertainties. We have to analyse it before we say something". What is worrying, however, is the decline in Gross Fixed Capital Formation (GFCF) an indicator of investment. GFCF growth rates at current and constant prices are estimated at (-)3.2 per cent and (-)5.6 per cent during Q2 of 2016-17 as compared to 7.5 per cent and 9.7 per cent during Q2 of 2015-16. Talking about challenges, Subramanian said investment was down substantially in the second quarter and that is something that needs to be watched. Referring to the impact of demonetisation of 500 and 1000 rupee notes by the government earlier this month, CII Director General Chandrajit Banerjee said that it would be a "temporary setback" to growth in the coming quarter. As per CSO, GDP at constant (2011-12) prices in the second quarter of 2016-17 is estimated at Rs 29.63 lakh crore, as against Rs 27.62 lakh crore in the year-ago period. The quarterly GVA at basic price at constant (2011-12) prices for July-September is estimated at Rs 27.33 lakh crore, as against Rs 25.52 lakh crore year-on-year. Government Final Consumption Expenditure (GFCE) at current prices is estimated at Rs 5.15 lakh crore for the second quarter as against Rs 4.27 lakh crore year ago. At constant (2011-2012) prices, the GFCE is estimated at Rs 3.84 lakh crore as against Rs 3.33 lakh crore. In terms of GDP, the rates of GFCE at current and constant prices during the second quarter are estimated at 14.1 per cent and 13 per cent respectively, as against the corresponding rate of 13.1 per cent and 12.1 per cent in the same period of 2015-16. Chief Statistician Anant also informed that the 'advance estimates' for national accounts data for the current fiscal will be released on January 7, a month in advance. The data release date is being advanced as government would be presenting the annual budget a month ahead of the usual practice of unveiling it on last working day of February. The data on eight core infrastructure sectors recorded a growth rate of 6.6 per cent in October on the back of impressive performance by steel and refinery products. However, growth rate of power generation, fertiliser production and cement output fell considerably on a year-on-year basis. Coal production continued to fall for the third straight month. The core infrastructure sectors -- coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity -- showed 3.8 per cent in October last year. Core sector contributes 38 per cent to the total industrial production. (PTI)

India's GDP increases to 7.3% in second quarter

China&#39;s economy expanded more than expected in the second quarter of the year, data showed today, fuelling hopes growth may be stabilising, but analysts warned private investment still needed to pick up. 
 
The world&#39;s second biggest economy grew 6.7 per cent year on year in April-June, slightly quicker than forecast in an AFP survey and the same as the previous three months. 
 
The result is also in line with the government&#39;s 6.5-7.0 target for the full year and will provide some much-needed relief as China and key driver of the global economy suffers its worst rates of growth for 25 years. 
 
&quot;The national economy has achieved moderate but steady and sound development,&quot; National Bureau of Statistics spokesman Sheng Laiyun said, adding he was confident that the annual growth target could be achieved. 
 
Markets were unmoved by the figures, with Shanghai&#39;s composite index ending the morning slightly lower. 
 
However, economists analysts said the growth was driven by state investment in infrastructure and a real-estate rebound, suggesting it may be hard to maintain in the longer-term. 
 
&quot;China is on track of achieving this year&#39;s growth target,&quot; said Haibin Zhu, JP Morgan China chief economist. But he added that while industrial production was &quot;very strong&quot;, private investment was weak. 
 
After decades of breakneck growth policymakers are now trying to retool the economy, embracing weaker growth as a trade-off for structural reforms to wean the country off cheap exports and massive government spending in favour of domestic consumption. 
 
But the transition has proved challenging. 
 
Fixed asset investment, a gauge of infrastructure spending, rose nine per cent in the first half of the year, amid a record credit binge in the first quarter aimed at stimulating China&#39;s slowing economy. 
 
Investment concern 
 
And investment by private businesses grew by less than three percent in the first half of the year, the data showed. 
 
Sheng blamed the slowdown in private investment on overcapacity in traditional industries, barriers for private firms to enter some sectors, and limited access to loans. 
 
Tom Rafferty of the Economist Intelligence Unit said &quot;levels of state investment we have seen are not sustainable if the authorities are at all serious about curbing debt risks&quot;. 
 
The &quot;greatest concern&quot; is the slide in investment by private firms, he added, in a sign that businesses are worried about the wider economy and Beijing is &quot;failing to deliver on promised market reforms&rdquo;. 
 
Factory production and consumer spending grew slightly, and industrial output rose over six per cent on year in June, a slight increase on the previous month, although retail sales rose far more than expected. 
 
The data come days after another downbeat reading on trade, which showed the fall in imports and exports accelerated in June. 
 
Klaus Baader, Hong Kong-based chief economist for Asia Pacific of Societe Generale, said: &ldquo;I think it has been engineered by significant reacceleration in credit growth. He added that the growth figure was &quot;a little bit disappointing&quot;, given the scale of lending expansion. 
 
Official Chinese figures are viewed with widespread scepticism, and just days ago the government altered its growth calculation method for the second time in less than a year. 
 
Today&#39;s figures &quot;should be taken with a grain of salt&quot; because of the political pressures on officials to meet the growth target, research firm Capital Economics said in a note. 
 
(AFP)

The world's second biggest economy grew 6.7 per cent year on year in April-June, slightly quicker than AFP forecast

China's economy expanded more than expected in the second quarter of the year, data showed today, fuelling hopes growth may be stabilising, but analysts warned private investment still needed to pick up. The world's second biggest economy grew 6.7 per cent year on year in April-June, slightly quicker than forecast in an AFP survey and the same as the previous three months. The result is also in line with the government's 6.5-7.0 target for the full year and will provide some much-needed relief as China and key driver of the global economy suffers its worst rates of growth for 25 years. "The national economy has achieved moderate but steady and sound development," National Bureau of Statistics spokesman Sheng Laiyun said, adding he was confident that the annual growth target could be achieved. Markets were unmoved by the figures, with Shanghai's composite index ending the morning slightly lower. However, economists analysts said the growth was driven by state investment in infrastructure and a real-estate rebound, suggesting it may be hard to maintain in the longer-term. "China is on track of achieving this year's growth target," said Haibin Zhu, JP Morgan China chief economist. But he added that while industrial production was "very strong", private investment was weak. After decades of breakneck growth policymakers are now trying to retool the economy, embracing weaker growth as a trade-off for structural reforms to wean the country off cheap exports and massive government spending in favour of domestic consumption. But the transition has proved challenging. Fixed asset investment, a gauge of infrastructure spending, rose nine per cent in the first half of the year, amid a record credit binge in the first quarter aimed at stimulating China's slowing economy. Investment concern And investment by private businesses grew by less than three percent in the first half of the year, the data showed. Sheng blamed the slowdown in private investment on overcapacity in traditional industries, barriers for private firms to enter some sectors, and limited access to loans. Tom Rafferty of the Economist Intelligence Unit said "levels of state investment we have seen are not sustainable if the authorities are at all serious about curbing debt risks". The "greatest concern" is the slide in investment by private firms, he added, in a sign that businesses are worried about the wider economy and Beijing is "failing to deliver on promised market reforms”. Factory production and consumer spending grew slightly, and industrial output rose over six per cent on year in June, a slight increase on the previous month, although retail sales rose far more than expected. The data come days after another downbeat reading on trade, which showed the fall in imports and exports accelerated in June. Klaus Baader, Hong Kong-based chief economist for Asia Pacific of Societe Generale, said: “I think it has been engineered by significant reacceleration in credit growth. He added that the growth figure was "a little bit disappointing", given the scale of lending expansion. Official Chinese figures are viewed with widespread scepticism, and just days ago the government altered its growth calculation method for the second time in less than a year. Today's figures "should be taken with a grain of salt" because of the political pressures on officials to meet the growth target, research firm Capital Economics said in a note. (AFP)

China economy beats growth forecasts in Q2

China&#39;s growth slipped to a new seven-year low of 6.6 per cent in the second quarter, according to an AFP survey, despite government efforts to spur activity in the world&#39;s second-largest economy. 
 
The forecast for expansion in gross domestic product (GDP), based on a poll of 17 economists, represents an easing from 6.7 per cent in the first three months of the year. 
 
As the world&#39;s biggest trader in goods, China is crucial to the global economy and its performance affects partners from Australia to Zambia. Investors worldwide have been worried by its slowing growth. 
 
&quot;Momentum remains downward, so if the government would like to maintain a 6.5 per cent minimum growth rate in the next several years, more aggressive stimulus will be needed,&quot; Brian Jackson, Beijing-based economist at IHS Economics, said. &nbsp; 
 
The slowdown comes as policymakers seek to retool the economy, embracing weaker growth as a trade-off for structural reforms to wean the country off cheap exports and massive government spending in favour of domestic consumption. 
 
GDP expanded 6.9 per cent in 2015 - its weakest in a quarter of a century - and the government has targeted growth in a range of 6.5-7 per cent for this year. The AFP poll forecasts China will just meet the goal, predicting 6.6 per cent. 
 
Official Chinese figures are viewed with widespread scepticism, and just days ago the government altered its growth calculation method for the second time in less than a year. 
 
&quot;China&rsquo;s quarterly GDP releases are being greeted with increasing scepticism and for good reason,&quot; Capital Economics said in a recent research report. &quot;The speed of growth that it points to is increasingly hard to believe given the clear structural drags that the economy is facing.&quot; 
 
Still, most wave off fears of a &quot;hard landing&quot; for China.&nbsp;&quot;We expect data for the second quarter of 2016 to further reinforce our view that China has not collapsed,&quot; PNC Financial Services Group senior international economist Bill Adams said in a research note, though he added the country still faces &quot;daunting challenges&quot;. 
 
Loosening seen 
 
Lower commodity prices, a decline in private spending and weak exports all dragged on the economy in the April-June period, analysts said.&nbsp; 
 
Adding to the uncertainty, recent flooding in China could cut into industrial production although at the same time give the government the opportunity to build infrastructure for water control, which could be positive for longer-term growth. 
 
&quot;Infrastructure will likely remain a key sector that policy makers rely on to stabilise growth,&quot; Rong Jing, an economist at BNP Paribas in Beijing, said.&nbsp;Britain&#39;s decision to exit the European Union, could actually benefit China, some analysts argue. 
 
&quot;If &#39;Brexit&#39; results in slower growth in the UK and anxiety in the developed West and in emerging Europe, the Chinese share of global growth could rise even higher,&quot; Andy Rothman, investment strategist at Matthews Asia, said in a research note. 
 
In order to maintain expansion, the central bank must maintain its loose monetary policy, possibly by again cutting the proportion of funds banks must set aside as reserves as well as interest rates - which it has already lowered six times since late 2014. 
 
An annual summer gathering of Chinese leaders at the beach resort of Beidaihe could yield other economic policies after the State Council, or cabinet, called for support to boost private investment, analysts said.&nbsp; 
 
&quot;The government is likely to introduce further loosening but not necessarily strong stimulus,&quot; Zhao Yang, an economist at Nomura in Hong Kong, said.&nbsp;&quot;Economic growth will likely continue to slow down in the next two to three years,&quot; he said, adding the level could drop to 5.0 per cent or even less. 
 
(AFP)

An AFP survey, based on a poll of 17 economists, says the slowdown comes as policymakers opt for weaker growth but structural reforms

China's growth slipped to a new seven-year low of 6.6 per cent in the second quarter, according to an AFP survey, despite government efforts to spur activity in the world's second-largest economy. The forecast for expansion in gross domestic product (GDP), based on a poll of 17 economists, represents an easing from 6.7 per cent in the first three months of the year. As the world's biggest trader in goods, China is crucial to the global economy and its performance affects partners from Australia to Zambia. Investors worldwide have been worried by its slowing growth. "Momentum remains downward, so if the government would like to maintain a 6.5 per cent minimum growth rate in the next several years, more aggressive stimulus will be needed," Brian Jackson, Beijing-based economist at IHS Economics, said. The slowdown comes as policymakers seek to retool the economy, embracing weaker growth as a trade-off for structural reforms to wean the country off cheap exports and massive government spending in favour of domestic consumption. GDP expanded 6.9 per cent in 2015 - its weakest in a quarter of a century - and the government has targeted growth in a range of 6.5-7 per cent for this year. The AFP poll forecasts China will just meet the goal, predicting 6.6 per cent. Official Chinese figures are viewed with widespread scepticism, and just days ago the government altered its growth calculation method for the second time in less than a year. "China’s quarterly GDP releases are being greeted with increasing scepticism and for good reason," Capital Economics said in a recent research report. "The speed of growth that it points to is increasingly hard to believe given the clear structural drags that the economy is facing." Still, most wave off fears of a "hard landing" for China. "We expect data for the second quarter of 2016 to further reinforce our view that China has not collapsed," PNC Financial Services Group senior international economist Bill Adams said in a research note, though he added the country still faces "daunting challenges". Loosening seen Lower commodity prices, a decline in private spending and weak exports all dragged on the economy in the April-June period, analysts said. Adding to the uncertainty, recent flooding in China could cut into industrial production although at the same time give the government the opportunity to build infrastructure for water control, which could be positive for longer-term growth. "Infrastructure will likely remain a key sector that policy makers rely on to stabilise growth," Rong Jing, an economist at BNP Paribas in Beijing, said. Britain's decision to exit the European Union, could actually benefit China, some analysts argue. "If 'Brexit' results in slower growth in the UK and anxiety in the developed West and in emerging Europe, the Chinese share of global growth could rise even higher," Andy Rothman, investment strategist at Matthews Asia, said in a research note. In order to maintain expansion, the central bank must maintain its loose monetary policy, possibly by again cutting the proportion of funds banks must set aside as reserves as well as interest rates - which it has already lowered six times since late 2014. An annual summer gathering of Chinese leaders at the beach resort of Beidaihe could yield other economic policies after the State Council, or cabinet, called for support to boost private investment, analysts said. "The government is likely to introduce further loosening but not necessarily strong stimulus," Zhao Yang, an economist at Nomura in Hong Kong, said. "Economic growth will likely continue to slow down in the next two to three years," he said, adding the level could drop to 5.0 per cent or even less. (AFP)

New survey says China?s Q2 growth slips to a seven-year low of 6.6%

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