New Delhi: Despite steps like the corporate tax cut, merging banks and announcing the biggest privatisation drive ever, the Gross domestic product grew 4.5 per cent in the second quarter (July to September) in the current financial year. The previous low was recorded at 4.3 per cent in 2012-13 (January-March).
Core sector output shrinks 5.8% in October
The output of eight core infrastructure industries contracted by 5.8 per cent in October, indicating the severity of economic slowdown, according to the government data released on Friday. Coal production fell steeply by 17.6 per cent, crude oil by 5.1 per cent, and natural gas by 5.7 per cent. Production of cement (- 7.7 per cent), steel (- 1.6 per cent), and electricity (- 12.4 per cent) also declined during the month.
India’s fiscal deficit touches Rs 7 trillion
Within the first seven months, India surpassed the annual target of fiscal deficit. The deficit stood at Rs 7.2 trillion which is 102.4 per cent of the budgeted target for the current fiscal year.
Is this a recession?
A recession is defined as a period of negative economic growth over two consecutive quarters. Recently finance minister Nirmala Sitharaman in the Rajya Sabha has said that there won’t be a recession ever. ” Growth may have come down, but not a recession yet, and won’t be a recession ever,” the minister said.
Look forward to the next quarter
The finance ministry has said that the growth rate will be up from the next quarter. The fundamentals of the Indian economy remain strong. GDP growth is expected to pick up from the 3rd quarter. IMF has projected India’s GDP growth at 6.1 per cent in FY 2019-20 and 7 per cent in FY2020-21 in its October report.
India no more the fastest growing economy
Till 2018, India was the fastest-growing economy. But not anymore in 2019. China is now the fastest-growing economy thought its GDP growth too slowed to 6% in the September quarter, the weakest quarterly growth rate since 1992, down from 6.2% in the previous quarter.