Fastest Growing Economy Current Affairs - 2020

CSO Data on Q3 GDP

The Central Statistical Office (CSO) has released the data about the GDP for the third quarter. The important facts from the data are:

  • Indian economy decelerated at a faster pace than anticipated in the third quarter of 2018-19 to 6.6%. This was the lowest in five quarters. This increases the possibility of another round of rate cuts by the Reserve Bank of India (RBI) in April to support growth.
  • The full-year growth forecast for the current fiscal year has been revised to 7% from the 7.2% estimated earlier.
  • The growth rates for the earlier quarters ere also revised downward to 8% and 7% respectively.
  • It is also estimated that in the March quarter the economy would decelerate to 6.4%.
  • The size of the Indian economy through the nominal gross domestic product (GDP) was revised upward to Rs 190.54 trillion ($2.7 trillion) against Rs 188.41 trillion ($2.65 trillion).
  • This revision of the size of the GDP would aid in achieving the fiscal deficit target of 3.3% of GDP for 2018-19 as estimated in last year’s budget against the revised estimate of 3.4%.

Even after the deceleration in growth rate, India remains the fastest growing economy as China’s economy cooled in the December quarter to a 28-year low of 6.4%.

World Economic Situation and Prospects 2019: Key Facts about India

The World Economic Situation and Prospects 2019 report make the following projections for India:

  • India’s GDP growth is expected to accelerate to 7.6 per cent in 2019-20 from an estimated 7.4 per cent in the current fiscal ending March 2019 and growth rate may come down to 7.4 per cent a year later.
  • India will march ahead as world’s fastest-growing large economy in 2019 as well as in 2020, much ahead of China.
  • India’s growth is driven by robust private consumption, a more expansionary fiscal stance and benefits from previous reforms and robust and sustained recovery of private investment remain crucial for lifting the medium-term growth.

While the report suggests a growth rate of around 3 per cent in 2019 and 2020 amid signs that growth has peaked and cautions that a worrisome combination of development challenges could further undermine growth.