Mining and agriculture lag behind other sectors in terms of GVA growth in Jan-Mar '18
The country’s agrarian sector in the last financial year expanded at almost half the rate at which it grew in 2016-17, shows the recently released provisional estimates by the Central Statistics Office (CSO). As compared to a growth rate of 6.3 percent witnessed in 2016-17, the growth rate in real Gross Value Added (GVA) by the agrarian sector (i.e., increase in agricultural GVA after neutralizing the effect of price inflation) had nearly halved to reach 3.4 percent in 2017-18.
The recently released provisional estimates has revised the growth in real GVA by the agrarian sector during 2017-18 to 3.4 percent, up from 3.0 percent as was suggested by the second advance estimates (released on 28th February, 2018). The first advance estimates (released on 5th January, 2018) had predicted the annual growth in real GVA by the agrarian sector to be 2.1 percent for 2017-18. Please check the interactive chart-1 for further details.
Likewise, the growth rate in real GVA at basic prices for the entire economy during 2017-18 has been marginally revised upward from 6.4 percent to 6.5 percent. The provisional estimates by the CSO reveals that the GVA (at 2011-12 prices) by ‘agriculture, forestry and fishing’ grew at almost half the rate at which the real GVA for the entire economy increased in the last financial year. Please consult chart-1 for details.
If the sum total of GVA at basic prices (at 2011-12 prices) by 'agriculture, forestry & fishing' and 'public administration, defence and other services' sectors is deducted from the GVA at basic prices (at 2011-12 prices) of the economy, then it could be found that the growth rate in real GVA of the economy for the year 2016-17 would reduce to 6.7 percent from 7.1 percent but for the year 2017-18 it remains at almost the same level of 6.5 percent.
The press note on provisional estimates state that the GVA estimates of the agrarian sector have been compiled by the CSO using the third advance estimates of crop production that was released by the Ministry of Agriculture and Farmers’ Welfare on 16th May, 2018. According to the third advance estimates, the food grain production is anticipated to be 279.51 million tonnes in 2017-18, which is higher than the second advance estimates of food grain production during 2017-18 of 277.49 million tonnes and also the final estimates of 275.11 million tonnes of food grains during the crop year 2016-17.
Impact of north east monsoon on rabi food grain production
The available data on rainfall suggests that the total food grain production may have increased in the crop year 2017-18 on account of normal rainfall during the north east monsoon. The India Meteorological Department (IMD) data suggests that the rainfall during south west monsoon seasons (June-September) of 2016 and 2017 were 97 percent and 95 percent of long period average (LPA), respectively.
The rainfall during the north east monsoon of 2016 was deficient (ranging from -20 percent to -59 percent) over all the five sub-divisions that benefit from it viz. Tamil Nadu & Puducherry, Coastal Andhra Pradesh, Rayalaseema, South Interior Karnataka and Kerala. As opposed to that, the rainfall during the north east monsoon in 2017 was normal (ranging from -19 percent to +19 percent) over the 4 sub-divisions that benefit from it viz. Tamil Nadu, Kerala, Rayalseema and Southern Interior Karnataka, but was deficient (ranging from -20 percent to -59 percent) over the other sub-division viz. Coastal Andhra Pradesh (-48 percent).
Table 1: Production of various kharif and rabi crops (in million tonnes)
Source: Third Advance Estimates of Production of Foodgrains for 2017-18, released on 16th May, 2018, Ministry of Agriculture & Farmers Welfare, please click here to access
Note: Foodgrain production has been calculated by summing up production of rice, wheat, pulses and coarse cereals only
The positive impact of 2017 north east monsoon rainfall on agricultural output is also evident from table-1.
The table-1 shows that rice production increased by 12.8 percent between the rabi seasons of 2016-17 and 2017-18 but the same increased by just 0.1 percent between the kharif seasons of the two crop years.
The production of kharif pulses fell by 5.9 percent between 2016-17 and 2017-18 but the production of rabi pulses grew by 14.4 percent between the two crop years.
The production of kharif food grains increased marginally by 0.3 percent between 2016-17 and 2017-18 but the production of rabi food grains grew by 2.9 percent between the two crop years.
Although the production of kharif oilseeds fell by 3.9 percent between 2016-17 and 2018, the production of rabi oilseeds expanded by 2.0 percent between the two crop years.
Quarterly growth in GVA at Basic Prices
In all the four quarters of 2017-18, the growth rate in real GVA by 'agriculture, forestry & fishing' had stayed below that of the quarterly growth rates seen in 2016-17. For example, although the agrarian sector grew by 4.5 percent during Q4 of 2017-18, it was lesser than the growth rate of 7.1 percent observed during the corresponding period in 2016-17. Please check the interactive chart-2.
If the 'public administration, defence and other services' sector is ignored, then it could be observed that the real GVA by the 'construction' sector had registered the highest growth rate of 11.5 percent during Q4 of 2017-18 vis-à-vis other sectors of the economy, followed by the 'manufacturing' sector (9.1 percent). For further details, kindly see the interactive chart-2.
The real GVA by the 'mining and quarrying' sector had registered the lowest growth rate of 2.7 percent during Q4 of 2017-18 as compared to other sectors/ industries.
Sectors like 'Trade, Hotels, Transport & Communication and Services related to Broadcasting' and 'Financial, Real Estate & Professional Services' witnessed a decline in their real GVA growth rate during Q4 of 2017-18 vis-à-vis previous quarterly growth rates registered in the same financial year.
Readers may please note that GVA is the difference between Gross Domestic Product (GDP) and net indirect taxes.
Press Note on Provisional Estimates of Annual National Income, 2017-18 and Quarterly Estimates of GDP for the Fourth Quarter (Q4) of 2017-18, CSO, MoSPI, released on 31st May, 2018, please click here to access
Press Note on Second Advance Estimates of National Income 2017-18 and Quarterly Estimates of GDP for the 3rd Quarter (Q3) of 2017-18, released on 28th February, 2018, CSO, MoSPI, please click here to access
Press Note on First Advance Estimates of National Income 2017-18, released on 5th January, 2018, CSO, MoSPI, please click here to access
Third Advance Estimates of Production of Foodgrains for 2017-18, released on 16th May, 2018, Ministry of Agriculture & Farmers Welfare, please click here to access
Second Advance Estimates of Production of Foodgrains for 2017-18, released on 27th February, 2018, Ministry of Agriculture & Farmers Welfare, please click here to access
2017 Southwest Monsoon End of Season Report, IMD, please click here to access
2016 Southwest Monsoon end of season report, IMD, please click here to access
2017 Northeast Monsoon End of Season Report, IMD, please click here to access
2016 Northeast Monsoon End of Season Report, IMD, please click here to access
Agricultural sector growth slows down to 3%, show new estimates, News alert by Inclusive Media for Change dated 9 March, 2018, please click here to read more
Agriculture Ministry differs with CSO over estimated growth of farm sector, News alert by Inclusive Media for Change dated 9th January, 2018, please click here to read more
Provisional estimates: Good rabi crop, uptick in factory output lift GDP up to 7.7% -Aanchal Magazine, The Indian Express, 1 June, 2018, please click here to read more
India's agriculture growth slips to 4.5% in Q4 on higher base -Sanjeeb Mukherjee, Business Standard, 31 May, 2018, please click here to read more
Image Courtesy: Inclusive Media for Change/ Shambhu Ghatak
Tagged with: Agricultural Growth Agriculture Central Statistics Office (cso) Gross Value Added (gva) Gross Value Added (gva) By Agriculture Ministry Of Agriculture & Farmers Welfare (moafw) Ministry Of Statistics And Programme Implementation Mospi Farming