India has retained the fastest growing economy tag clocking a stellar 7.7 % in fourth quarter of the FY18. "In terms of growth rates, the Gross National Income is estimated to have risen by 6.7 per cent during 2017-18, in comparison to the growth rate of 7.1 per cent in 2016-17".
"So manufacturing at 9.1 per cent and construction at 11.5 per cent indicate a turnaround in the economy which going forward would also give a big momentum to growth", he said.
The statement said the sectors which registered growth rate of over 7 per cent are "public administration, defence and other services" (10 per cent), ' trade, hotels, transport, communication and services related to broadcasting" (8 per cent) and "electricity, gas, water supply & other utility services' (7.2 per cent). There has been improvement in growth rate in manufacturing and construction. "On balance, GDP and GVA growth are expected to improve to 7.1% and 7.0%, respectively, in FY2019, from 6.7% and 6.5%, respectively, in FY2018". There have been various quarters and years when oil prices have gone up but there has been growth also. He emphasized that this is the development under leadership of Prime Minister Narendra Modi and Union Minister Arun Jaitley.
The decline in the annual GDP growth has been mainly due to dip in manufacturing, agriculture and mining activities.
Though the farm GVA output growth was well above satisfactory mark of 4 per cent at 4.5 per cent in fourth quarter, it was lower than 7.1 per cent a year ago. The moderation in growth was driven by impacts from successive policy shocks of demonetization and the Goods and Services Tax; and the twin balance sheet problem of high corporate leverage and banks' stressed balance sheets.
Around two-thirds of economists in the poll who answered an extra question said growth would continue at roughly the same pace through the fiscal year that began on April 1.
It also highlighted an acceleration in rural consumption, higher minimum support prices and a normal monsoon to stabilize growth on the domestic front.
India's recovery could be threatened by higher global crude oil prices, which this month hit $80 a barrel, their highest since 2014. Some headwinds do remain from the perspective of rising crude oil prices, and unwinding of global easy monetary policy & rising interest rates. But private investment is not expected to boost growth significantly over the next few quarters, given the high level of slack capacity and lending constraints in the banking sector.