FM Jaitley dubs slowdown in GDP as 'matter of concern'

Commenting on the Gross Domestic Product (GDP) figures that were released earlier on Thursday, Union Finance Minister Arun Jaitley said the slowdown in the growth of GDP is a 'matter of concern' for the economy.

"The GDP figures released earlier today is matter of concern, as the slowdown in growth throws up a challenge for the economy to revive in the coming quarters by working on policies and improving these figures," he said while addressing a press conference here.

"In April, May and June, manufacturers were de-stocking in anticipation of the GST. Therefore, although trading went up with sales taking place, it should be noted that it was existing stocks being sold. Manufacturing was going through a temporary slowdown in this period. However, de-stocking has now been completed, and therefore we can expect production to go up," he said.

Further, he opined that the situation will improve in the future, owing to good monsoons, positive revenue trend, continuation of the FDI and increase in domestic public investment.

"The global economy is improving faster than expected, which is a good sign. We are also expecting early successes for the banking industry on the insolvency front," added Jaitley.

India's economy unexpectedly slowed further to a three-year low after the Gross Domestic Product (GDP) in the first quarter (Q1) of 2017-18 was estimated at Rs.31.10 lakh crore, as against Rs. 29.42 lakh crore in the corresponding quarter of 2016-17, thus registering a growth rate of 5.7 percent.

Meanwhile, Quarterly GVA with basic price at constant (2011-2012) prices for Q1 of 2017-18 was estimated at Rs. 29.04 lakh crore, as against Rs. 27.51 lakh crore in Q1 of 2016-17, showing a growth rate of 5.6 percent, stated an official release published by the Central Statistics Office (CSO) noted.

The economic activities which registered growth of over seven percent in Q1 of 2017-18 over Q1 of 2016-17 were trade, hotels, transport and communication, public administration, defence, electricity, gas, water supply and other utility services.