Despite Q2 slowdown, GDP growth of 6.5-7% still feasible: CEA

New Delhi: Despite a sharp slowdown in gross domestic product (GDP) growth in July-September quarter India’s underlying growth story still remains “very much intact” and it is feasible to achieve the overall 6.5 to 7 per cent expansion for the current financial year, as projected in the Economic Survey, Chief Economic Advisor (CEA) V Anantha Nageswaran said on Thursday.

India’s gross domestic product (GDP) growth slipped to a seven quarter low of 5.4 per cent in July-September period, dragged by a sharp slowdown in manufacturing activities, as per data released by the National Statistics Office (NSO) last week. This growth number is sharply lower than the projections by the government and the Reserve Bank of India (RBI).

Speaking at at an event organised by industry body - the Associated Chambers of Commerce & Industry of India (Assocham), the government’s top economic advisor cautioned against overinterpretation of the Q2 numbers. “I think in reacting to this number, we should not throw the baby out with the bathwater, because the underlying growth story remains very much intact,” he said.

Nageswaran, however, underlined that the global environment is not conducive for India’s growth and hence the country must “pull all domestic levers for growth."

Upcoming Economic Survey

Policy reforms for easing regulatory barriers to more employment opportunities and bridging gender divide would be the key focus of the Economic Survey to be presented in Parliament at the end of January, the CEA also informed.

“We touched upon it quite a bit in the economic survey in July, and that is going to be the big theme. Deregulation or letting go is the big theme for the coming economic survey as well,” he stressed.

Chief Economic Advisor is the lead author of an economic survey, which is released every year before the presentation of the union budget.  The Economic Survey 2024-25 is likely to be tabled in Parliament on January 31.

Underscoring the need for policy reforms in states and local government-level, Nageswaran said, “We still have in our statute books, rules and regulations by states that prohibit women from engaging in certain occupations because they are considered dangerous.”

To bridge the gender divide as well as push job creation, policy can do more in terms of deregulation, he added.