The services sector, which accounts for almost 60% of the economy, is estimated to grow 8.3% in 2017-18, higher than the 7.7% in 2016-17. The Central Statistical Office released the first advance estimate of India's Gross Domestic Product for the 2017-'18 financial year.
GDP is seen growing 6.5% in FY18, down from 7.1% past year, according to the first advance estimates released by the statistics office on Friday. The per capita income in real terms (at 2011-12 prices) during 2017-18 is likely to attain a level of Rs 86,660 as compared to Rs 82,269 for the year 2016-17, it said.
India's GDP growth is forecast to slow down to a four-year low of 6.5 per cent in 2017-18 as it was hit by demonetisation and the rollout of a chaotic GST, which was changed repeatedly in the past six months to quell protests by traders and industry. In the second quarter, the economy showed signs of revival as the GDP growth rate picked up and stood at 6.3 per cent.
According to CSO, GVA is expected to grow at 6.1% during FY2017-18 against 6.6% in FY2016-17 at basic constant prices of 2011-12.
GDP had grown by 6 per cent in the first six months of FY18.
"It is hard for GDP to cross 7 per cent this fiscal unless the base is revised downwards". It was said that this had happened in expectation of implementation of Goods and Services Tax from July 1, this year.
Previous year the government changed the presentation of Union Budget from February-end to 1 February that started the practice of unveiling advance GDP forecast in January.
Within this, the GVA growth rate for "agriculture, forestry and fishing" is expected to slow sharply to 2.1%, compared with the previous year's 4.9% pace.
Analysts will also keenly examine the data used for calculating the advance GDP estimates. The core sector data for November, the latest release so far, showed the steel and cement sectors registering strong double-digit growth.
"Accordingly, the advance estimates for GDP and GVA growth appear to be understating economic expansion for FY2018, in our view", Nayar said.
"Nominal GDP growth is expected at 9.5%". Taken together, India's "real" or inflation-adjusted GDP grew 6 percent in April-September.
The CSO forecast comes three weeks before the Modi government comes out with its final full-year budget before the general election due in May 2019.
"Given the tepid growth estimates from agriculture, it gives us a feeling that the budget 2018 will have a higher focus on agriculture and rural economy". The second instalment of the Economic Survey released in August past year had seen growth at the lower end of the 6.75-7.5% range forecast in February.