Mumbai: Ahead of the official release of the second-quarter GDP figures, State Bank of India (SBI) on Monday estimated the country’s economy to expand by 7.5-7.6 percent, slower than the prior quarter, mainly on account of a slowdown in rural demand. India’s largest lender also said in its Ecowrap report that the SBI Composite Leading Indicator (CLI), a basket of 21 leading indicators for the quarter in consideration, is showing a marginal declining trend. “Consequently, the headline second quarter Gross Value Added (GVA) growth could be 7.3-7.4 percent, due to the slowing of rural demand,” the report said.
GVA is the measure of national income and output that includes taxes and excludes subsidies. As per the first-quarter (April-June) figures released earlier by the Central Statistics Office (CSO), India’s gross domestic product (GDP) had grown by 8.2 percent.
“We also believe that the growth numbers in the second quarter will be helped by a weak base in the September quarter of 2017-18. We estimate that the base impact on second-quarter GVA growth is around 30 bps (basis points). Based on tax collections, we subsequently expect second-quarter GDP growth at 7.5-7.6 percent,” said the report authored by SBI Chief Economist Soumya Kanti Ghosh.
It also said that commercial vehicle sales, domestic air passenger traffic and cement production have maintained double-digit growth during the second quarter, pushing up the quarter’s GVA estimate. (IANS)