Centre's advance estimate peg 2019-20 GDP growth at 5%, down from 6.8%; Mfg at 2%

India's real GDP (Gross Domestic Product) growth during financial year 2019-2020 is expected at 5% as compared to last year's 6.8%, according to first vance estimates released by Centre on Tuesday. This estimate is in line with Reserve Bank of India's (RBI) own revised estimate in December. ecomy grew 4.5%, lowest in six years, in second quarter (July-September) of this fiscal in weakening from previous quarter's 4.8%.

Data released by  National Statistical Office (NSO) of  Ministry of Statistics also estimated growth of real GVA (Gross Value ded) in 2019-20 to be 4.9% as against 6.6% in 2018-19. manufacturing sector is estimated to see a sharp deceleration in growth with just a 2% expansion as against last fiscal's 6.9%. farming sector is expected to see a marginal slide of 0.1% from previous year to 2.8%.

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Service sector's breakdown

• Electricity, Gas, Water Supply and Or Utility Services – 5.4%
• Tre, Hotels, Transport, Communication and Services related to Brocasting – 5.9%
• Financial, Real Estate and Professional Services – 6.4%
• Public ministration, Defence and Or Services – 9.1% 

Per Capita Income estimated at 4.3%

Per Capita Income in real terms (at 2011-12 prices) during 2019-20 is likely to attain a level of ₹96,563 as compared to ₹92,565 for year 2018-19. growth rate in Per Capita Income is estimated at 4.3% during 2019-20, as against 5.6% in previous year. Per capita income measures aver income earned per person in country in a specified year.

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Private consumption level to see marginal rise

Private domestic consumption, which drives Indian ecomy, is expected to marginally raise its share of GDP to 60.2% from last fiscal's 59.4%. Private Final Consumption Expenditure (PFCE) at current prices is estimated at ₹123.07 lakh crore in 2019-20 as against ₹112.90 lakh crore in 2018-19. current slowdown in ecomy is attributed to fall in consumption levels which has punctured any new appetite of private investments.

Investment rate estimated to fall

Gross Fixed Capital Formation (GFCF) at Current Prices is estimated at ₹57.42 lakh crore in 2019-20 as against ₹55.70 lakh crore of previous fiscal. This means that as a percent of GDP, rate of GFCF is estimated at 28.1% as against corresponding rates of 29.3%. GFCF is essentially net investment rate in ecomy in assets like machinery, industrial equipment, new techlogy, etc.

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What is First vance Estimates?

First vance Estimates of GDP is typically released a month before presentation of Union budget. estimates are compiled using  Benchmark-Indicator method.  sector-wise estimates are obtained by extrapolation of indicators like levels of industrial production, financial performance of private sector,  first vance estimates of crop production, accounts of Central & State Governments and information on indicators like bank deposits and credits, passenger and freight earnings of Railways, airways and waterways, sales of commercial vehicles, etc., available for first eight months of financial year.

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