Unravelling India's growth story

Major structural reforms are needed to raise growth rates to the highs achieved between 2003 and 2008

Alok Sheel
Illustration by Binay Sinha

Illustration by Binay Sinha

The Central Statistical Office’s (CSO’s) gross domestic product (GDP) data show that the economic expansion that began in 2014-15 peaked in 2016-17 at 8.2 per cent. Growth declined thereafter to 7.2 per cent in 2017-18, 6.8 per cent in 2018-19, and further to 4.8 per cent in the first half of 2019-20.
Quarterly data pinpoints growth peaking at 8.1 per cent in Q4 2017-18, followed by six successive quarterly declines, with Q2 2019-20 coming in at 4.5 per cent. The sharpest decline can be dated to Q2 2018-19, when growth fell to 7 per cent, from 8 per cent in the previous quarter. This was followed by 6.6 per cent in Q3 and 5.8 per cent in Q4. Growth continued to fall to 5 per cent in Q1 2019-20, and to 4.5 per cent in Q2. 
Economists are divided over whether the decline in growth is cyclical or structural. There is also an unresolved debate over the sanctity of the new 2011-12 GDP series, on which the above estimates are based.
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of or the Business Standard newspaper

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First Published: Dec 28 2019 | 8:53 PM IST

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