The Indian economy retained its tag of the fastest growing major economy in the world in FY 2018-19 for a second year in a row as it continued its climb on an upward growth path. The economy registered a growth rate of 7% during the 2018-19 period as per advance estimates of the Central Statistical Office.
The economy is projected to grow at the rate of 7.5% during 2019, expanding further to 7.7% during 2020 as per the International Monetary Fund (IMF) World Economic Outlook January update. The growth rates for the economy are pegged much higher than the global growth rates for the same years, at 3.5% and 3.6% for 2019 and 2020 respectively, thus placing the economy on a solid footing even amidst growing global uncertainties.
The Indian economy witnessed robust industrial growth during FY 2018-19 and the momentum is expected to continue next year as well. The Index of Industrial Production (IIP) with base 2011-12 for the April-January period for 2018-19 registered a 4.4% increase over the corresponding period for the previous year.
Eleven out of twenty-three industry-groups (as per 2-digit NIC) exhibited positive growth during January 2019 over the corresponding month in the previous year, with the industry groups “Manufacture of Food Products” and “Manufacture of Wearing Apparel” recording highest growth rates at 17% and 16.4% respectively. Among other positives, industries such as capital goods and infrastructure/construction goods expanded significantly. Healthy growth in core sectors such as steel and cement could strengthen further.
Growth in the agriculture sector is expected to moderate as the Gross Value Added (GVA) at basic prices for the sector is estimated at 2.7% for 2018-19 on a high base of 5% in 2017-18. The Indian Meteorological Department has indicated that monsoons will not be abnormal in India during this year and this would assist in growth of the farming sector.
The manufacturing sector is expected to post robust growth with the sector’s GVA growth estimated at 8.1% in 2018-19 as compared to 5.9% during 2017-18. Growth in the sectors including trade, hotel, transport, communication and services related to broadcasting, which moderated during the first half of the year is expected to pick up on account of improved domestic demand conditions. GVA growth for these sectors is estimated to grow by 7.3% in 2018-19 in contrast to 6.2% in 2017-18. Construction sector is expected to grow by 8.9% during 2018-19 as compared to 5.6% during 2017-18.
The consumer durables market is expected to pick up supported by rising disposable incomes, greater electrification and FDI investments. The FMCG sector continues to perform well and is expected to grow further, fueled by rising consumption and investment patterns. Retail businesses also continue to grow and present more growth opportunities as new retail outlets and malls open up.
On the trade front, Indian exports grew by 3.74% over January 2018 to reach US$ 26.36 billion in January 2019. Drugs and pharmaceuticals, organic and inorganic chemicals and readymade garments were the top performing commodity groups with growth rates of 15.2 %, 15.56% and 9.33% respectively.
Overall trade including services trade for India is estimated at around US$ 440 billion for April-January 2019, exhibiting a positive growth rate of 9.07% over the corresponding period during last year. Export growth is expected to gain further pace as global trade tensions ease.
CII Annual Session 2019: India 5.0: India@75 and Beyond
As India marches ahead on a solid growth trajectory to complete 75 glorious years of independence, Indian Industry remains committed to building a better India by actioning its agenda for the year 2019-20. Taking note of the growth fundamentals of the Indian economy at present, the CII Annual Session 2019 will bring together some of the brightest minds in the country to debate and deliberate on issues critical for the future development of the economy.
With the theme of “India 5.0: India@75 and beyond”, the Conference would focus on issues spanning diverse topics such as technology, future of jobs, future of banking, arts and culture, world trade, and future of media, among many others – all critical aspects for the all-round development of the Indian economy.
The CII Annual Session 2019 would be held during 4-5 April 2019 in New Delhi.