New Delhi: Finance Minister Nirmala Sitharaman took charge of the ministry on Friday marking her first day in the office. But her new start has not been pleasant.
In a bad news for the new government on day one, the CSO data showed that economic growth slowed to a 5-year low of 5.8 per cent in the fourth quarter of 2018-19, pushing India behind China, due to a poor showing by agriculture and manufacturing sectors.
The GDP numbers did not augur well for the new Finance Minister Nirmala Sitharaman who has a big task to revive the growth momentum and bring the economy back on track. Unfortunately, GDP growth is expected to maintain contraction even in Q1 period of current fiscal, making her exercise tougher.
The Central Statistics Office (CSO) also released a worrisome set of data on the rate of unemployment for 2017-18, confirming the pre-election leaked report's claim of joblessness at a 45-year high of 6.1 per cent.
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The growth of the eight core sector industries during April too witnessed a slowdown. The expansion was at a rate of 2.6 per cent. These industries contribute about 40 per cent of the overall factory output of the country.
There was, however, some relief on the front of government finances as the fiscal deficit for 2018-19 remained within the revised Budget target of 3.4 per cent of the GDP.
Commenting on the GDP data, Economic Affairs Secretary S C Garg said the slowdown in the fourth quarter of the last fiscal was due to temporary factors like stress in the NBFC segment. He also underscored that the economic activity may also remain sluggish during the April-June quarter of the current fiscal before picking up in the subsequent months.
The financial, real estate and professional services segment, however, showed improvement with the growth rate moving up to 9.5 per cent in the last quarter of 2018-19 from 5.5 per cent in the comparable period of the preceding fiscal.
Sitharaman on Friday created history again when she became the first full-time woman Finance Minister of India. She will now have to steer the country out of an imminent economic slowdown and address challenges like job creation, mounting bad loans and stimulating investment.
