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India GDP Growth: This news is disappointing on the economic front. On the one hand, while many brokerage firms have already said in their estimates due to the impact of India’s economic pace due to US tariff, on the other hand, news agency Reuters has made a poll of economists. In this poll, most of the opinions have been given that the speed of India’s economy can be slow in the April-June quarter and close to 6.7 percent.
India’s slow speed may remain slow
The Reuters Poll was done between 18 and 26 August, in which his opinion was taken from 70 economists. During this time it was estimated that the speed of India’s GDP could be 6.7 percent this time as against the 7.4 percent of the previous quarter. This pole of Reuters is slightly higher than the recent estimate of RBI. The RBI had estimated GDP growth to be 6.5 percent for the second quarter.
Causes of slow speed of GDP
According to the poll, the reduction in industrial activities and private investment was described as the biggest reason for GDP’s lethargy. However, capital expenditure has been increased by the government. In the first quarter of the current financial year, the government increased capital expenditure, but due to the weak demand of consumers, private investment declined.
Increase in capital expenditure
According to June data, capital expenses were increased by about 52 percent on an annual basis and about 2.8 trillion rupees were spent on infrastructure. Along with this, PM Modi has also proposed to reduce taxes on everyday consumption items and small cars, so that demand can be promoted.
RBI efforts and challenges
Significantly, continuous efforts are being made to speed up the country’s GDP growth. RBI has given a total relief of 75 basis points by cutting interest rates twice in consecutive times this year, which is more than expected. But its big impact on GDP growth is not yet visible. Also, many banks have not yet brought the benefit of low interest rates to consumers.
