Smart farm sector growth spurred India’s economy to grow 4.7 per cent in 2013-14, according to the gross domestic product (GDP) provisional estimates released on Friday. The GDP growth rate in the previous year was a decade-low of 4.5 per cent. This is the second year in a row during which the economy’s growth remained below the 5 percent.
The last time the economic growth rate had pierced the 5-per cent mark was in 1984-85 to 1987-88.
Good harvests in both the seasons lifted farm sector growth to 4.7 per cent for the year. It had grown 1.4 per cent in the previous fiscal. In the three-month period January-March, the farm sector grew 6.3 per cent against 1.6 per cent growth in the same period of 2012-13.
The data released by the Central Statistics Office (CSO) confirms that both the manufacturing and mining sectors shrunk in 2013-14 with fall in output. Lacklustre infrastructure activity dampened construction growth as well. The manufacturing sector contracted (-) 0.7 per cent in 2013-14 against 1.1 per cent in 2012-13. Mining and quarrying declined (-) 1.4 per cent against (-) 2.2 per cent in 2012-13.
Investments or capital formation fell due to low movement in infrastructure and high interest rates.
“...the ushering in of a stable government, post elections, has revived sentiments and lifted investor confidence which would pave the way for growth. But much more is required to turn around the economy,” Confederation of India Industry Director-General Chandrajit Banerjee said in a statement. FICCI President Sidharth Birla said in a statement: “Announcements made by the Prime Minister and his Cabinet ministers over the last few days leave us with an encouraging outlook, as the governmental actions will definitely have a positive impact on the investment sentiment.” “Going forward, the emphasis has to be on effective implementation and timely action.” The CSO’s advance estimate for GDP released in February had pegged the growth rate for 2013-14 at 4.9 per cent.
The estimate for per capita net national income in real terms (at 2004-05 prices) in 2013-14 is Rs.39,904 against Rs.38,856 in the previous year. The growth in per capita income is estimated at 2.7 per cent.
Echoing similar views, PHD Chamber President Sharad Jaipuria said: “Though growth of real GDP at 4.7 per cent for 2013-14 is below growth projections given by the CSO in its advanced estimates, it is expected to improve in the current financial year 2014-15 as the government is taking significant steps to rejuvenate the economy.”