Saturday, Apr 20, 2024 | Last Update : 02:16 PM IST
India's GDP hit hard by GST as it slips to 5.7 per cent in June quarter
This indicates the economy is reeling under the impact of the destocking activity and the uncertainty prevailing under GST.
New Delhi: India's Gross Domestic Product (GDP) growth slipped to 5.7 per cent during the first quarter of the current financial year, according to the numbers released by Central Statistics Office (CSO) on Thursday.
India’s GDP in the previous quarter was 6.1 per cent.
The slowing GDP number indicates the economy is reeling under the impact of the destocking activity and the uncertainty prevailing under the newly rolled the Goods and Services Tax (GST).
Retailers cleared out old stocks to avoid selling them under the ambit of GST and slowed down production for the same reason before July 1. Following this, manufacturing took a hit as it dipped to 1.2 per cent from 5.3 per cent in the previous quarter.
Trade, hotel and transportation services however revived in the March quarter and grew at 11.1 per cent.
Although experts had pegged India’s growth at 6.6 per cent (Reuters poll), the slide in the GDP figure is proof of the fact that the economy is still feeling the after-effects of demonetisation and that of GST.
With this, India loses its position as the fastest growing economy for the second time to China. In the previous and the current quarter, China recorded 6.9 per cent growth.
