New Delhi1 hour ago
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The government has maintained the GDP estimate for the financial year 2024-25 at 6.4%. A year ago i.e., 2023-24, this figure was 8.2%. The Statistics Ministry released these figures today i.e. on Tuesday, January 7.
From fiscal year 2022, the annual growth remains at 7% or above. This means that GDP growth may fall below 7% for the first time in the last 4 years. Growth was recorded at 9.7% in FY 2022, 7% in FY 23, 8.2% in FY 24.
Despite a sluggish first half (H1) of FY2025, the ministry expects growth to sustain in the second half driven by increased agricultural and industrial activity as well as rural demand. Whereas the Reserve Bank had estimated a growth of 6.6%.
India is still the fastest growing economy among major countries Despite slow GDP growth, India still remains the fastest growing economy among major economies. China's GDP growth in the July-September quarter of this financial year was 4.6%. Whereas Japan's GDP has grown at the rate of 0.9%.
What is GDP? GDP is one of the most common indicators used to track the health of the economy. GDP represents the value of all goods and services produced within a country in a specific time period. In this, the foreign companies which produce within the country's borders are also included.
There are two types of GDP There are two types of GDP. Real GDP and Nominal GDP. In real GDP, the value of goods and services is calculated at the base year's value or stable price. At present the base year for calculating GDP is 2011-12. Whereas nominal GDP is calculated at current price.
How is GDP calculated? A formula is used to calculate GDP. GDP=C+G+I+NX, here C means private consumption, G means government spending, I means investment and NX means net export.
Who is responsible for the fluctuations in GDP? There are four important engines for increasing or decreasing GDP. The first is you and me. Whatever you spend contributes to our economy. Second is private sector business growth. It contributes 32% to GDP. Third is government expenditure.
This means how much the government is spending to produce goods and services. It contributes 11% to GDP. And fourth is, net demand. For this, India's total exports are subtracted from total imports, because India has more imports than exports, hence its impact is negative on GPD.
