GDP data shows a deceleration in investment coupled with the predominance of consumption-led growth. A comparison of the relevant quarters (Q2 2016-17 with Q2 2017-18) shows a slowdown, with GVA down from 6.8% to 6.1% and GDP growth down from 7.5% to 6.3%. However, there should be concern that agriculture has shown a significant slowdown at 1.7%, against 4.1% in Q2 of 2016-17. In the near term, the urban and government consumption expenditure will go up due to the impact of the Seventh Pay Commission award. To top it, the predominance of consumption-led growth is a matter of serious concern in terms of sustainability.

Source: Mint December 05, 2017 21:56 UTC