First advance estimate of financial year 2019-20 GDP of India.

First advance estimate of financial year 2019-20 GDP of India

               The first advance estimates of GDP (Gross Domestic Product) of India for the financial year 2019-2020 have been released by the National Statistical Office (NSO), Ministry of Statistics and Program Implementation. The office has released the first advance Estimates of the National Income at Constant 2011-12 and current prices for FY 2019-20 along with the expenditure components of GDP.

               This report will be based on the growth numbers of the last 7 months as well as other frequency data. This data is released one month before the presentation of the union budget. Till 2017 the first advance estimates data normally used to be released in the last week of the January as the budget was presented on 28 February, but from 2017 The first advance estimates data has been released in the first week of the January it helps the government to prepare their budget to present on 1 February.

               This report is the final bit of official data before the government presents its budget. This report will help the government to calculate the fiscal deficit of the country. It is the basis for calculating the growth of India for the financial year 2020-2021 the budget. So it will help the government in the budget-making process.

Advance estimates of GDP of India

 The methodology for incorporating the Advance Estimates depend on the Benchmark-Indicator technique.  The sector-wise evaluation is obtained by extrapolation of a sign like (i) Crop production (ii) financial performance of Listed Companies in the Private Corporate sector available up to the quarter ending September 2019 (iii) Index of Industrial Production (IIP) of the first 7 months of the financial year 2019-20 (iv) accounts of  Central & State Governments, information on indicators like Deposits & Credits, Passenger and Sales of Commercial Vehicles, Freight earnings of Railways, Cargo handled at major Sea Ports, Passengers, and Cargo handled by Civil Aviation, etc. available for first 8 months of the financial year 2019-20.

GDP of India

The estimate shows that the GDP of India's growth expect to be 5% for the financial year 2020 as compared to 6.8% in the year-ago. GDP means Gross Domestic Product it is the sum of private consumption, government consumption, business investment, and the net export.in this report, it shows that private consumption expenditure will grow by 5.7% in 2019-20 while it grew by 8% last FY. Business investments grow by less than 1% while in the last FY it grew by 10 %. Government expenditure grows up by 10.55 which is higher than the rate of growth of 9.2% in the last FY.

GDP of India

The estimated growth of real Gross Value Added (GVA) in 2019-20 is 4.9% as against 6.6% in 2018-19. All the workers in our economy fall into 3 major categories i.e.  Primary sector (Agriculture), secondary sector (Industry) and last tertiary sector (Services). If we add the entire sector’s income and production it shows GVA. The main reason for decreasing GAV is the loss in manufacturing sector which is a sub-sector of industry, these sector has different sub-sector.

The decline in GVA has been mainly on account of deceleration in manufacturing sector growth which is expected to come down to 2% in Fy20.

Manufacturing sector growth 

Different institutions previously forecast the GDP of India then they now decrease this value.

GDP of India forecast by different institutions

The government has already took a number of steps to boost the economy, including a sharp cut in corporate tax rate announced a RS 120 lakh crore infrastructure development project, but expert have asked for more in the budget.

               There are suggestions for a cut in personal income tax to stimulate demand. Saugata Bhattacharya, the chief economist at Axis Bank, suggested better credit delivery to lift growth.

               A line by the chief economic adviser, SBI.  “The key to a quick recovery is consumption”.

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