InvestorQ : I just read that the GDP growth for the fourth quarter has slowed down to 5.8%. Is the Indian economy really slowdown and what does it mean for markets?
Anu Biswas made post

I just read that the GDP growth for the fourth quarter has slowed down to 5.8%. Is the Indian economy really slowdown and what does it mean for markets?

Answer
image
Neelam Naik answered.
1 year ago
Follow

You are right that the GDP for the fourth quarter has slowed to 5.8% but that was largely expected. Most of the economists had pegged the growth in the fourth quarter at around 6% and this is marginally below expectations. If you break up the GDP numbers, then agriculture and d manufacturing have been under pressure. However, this is the fourth quarter number but for the full year India’s GDP growth is still much higher at 6.8%. Of course, this is below the 7.3% growth that India was anticipating but that was more due to the combined effect of a slowdown in agriculture, election related delays and the liquidity crisis that has hit NBFCs in the third and fourth quarters. These factors combined to create problems of growth.

Regarding your question on whether India is slowing down, you need to understand that India is still the fastest growing large economy in the world. Even China is growing at just about 6.2% annually. The message of the GDP numbers is that the new government will have to take some real quick and drastic steps to push agricultural output, farmer incomes and manufacturing output to higher levels. You can be certain of seeing some very quick and rapid measures to counter this quarter GDP numbers.

4 Views