Winning Bizness Economic Desk
The country’s Gross Domestic Product (GDP) expanded at a much lower 5.4 per cent during the July-to-September period of this year, according to official data released here.
This is the slowest growth in seven quarters. However, what requires highlighting here is that despite this slow growth, the country still remains the fastest-growing major economy in the world.
The Q2 FY 25 growth of 5.4 per cent is below expectations as growth was expected in the 6.2 per cent-to-6.9 per cent range.
“Real GDP has been estimated to grow by 5.4 per cent in Q2 2024-25 over the growth rate of 8.1 per cent in Q2 FY 2023-24,” the finance ministry said in a statement.
Mining mainly hit the overall numbers by growing 2.2 per cent in Q2 FY 25 as against the five per cent expected. It had stood at seven per cent in the last quarter.
Trade, hotels, transport, communications and services related to broadcasting grew just six per cent as against the 7-8 per cent expected.
Here, it must be pointed out that the country’s GDP had grown 6.7 per cent in the previous quarter of April-to-June 2024 (Q1 FY 25).
It had grown at 8.1 per cent in the year-ago period (Q2 FY 24).
According to the National Statistical Office ((NSO), the country’s Gross Value Added (GVA), which is GDP minus net product taxes and reflects growth in supply, also grew 5.6 per cent during the July-to-September 2024 period.
The Gross Fixed Capital Formation (GFCF) slowed to 5.4 per cent to Rs 15.13-lakh-crore during the September 2024 quarter. The GFCF accounts for around 35 per cent of the GDP.
Private Final Consumption Expenditure (PFCE) grew six per cent Year-on-Year (YoY) to Rs 24.82-lakh-crore in Q1 FY 25. Besides, the Government Final Consumption Expenditure (GFCE) declined 4.4 per cent YoY to Rs 4-lakh-crore.
40 Tourism Projects Worth Over Rs 3,295-cr Receive Government Nod
Forty tourism projects in the country worth over Rs 3,295-crore and covering 23 states have received approvals from the Centre for developing lesser-known destinations into iconic sites and promote a more balanced distribution of tourists across the country.
As per the directives of the Department of Expenditure, the Ministry of Tourism has issued operational guidelines for Special Assistance to States/Union Territories (UTs) for Capital Investment (SASCI). This is for the development of iconic tourist centres.
The tourism ministry circulated the SASCI guidelines to state governments with a request to formulate and submit the project proposals to the ministry, which are iconic in nature and can create impactful destinations, officials were quoted in the media as saying.
By the last date of submission (October 15, 2024), a total of 87 project proposals were received costing more than Rs 8,000-crore, a senior ministry official was quoted as saying.
Some of the selected destinations include Rang Ghar, Sivasagar (Assam), Matsyagandha Lake, Saharsa (Bihar), proposed Town Square, Porvorim (Goa) and Orchha (Madhya Pradesh), among others.
The aim of this scheme is to infuse long-term interest-free loans for a period of fifty-years to states for comprehensively developing iconic tourist centres in the country and branding and marketing them on a global scale, the ministry said.
Here, it must be pointed out that by infusing capital investment in the form of projects, the scheme further envisages growth of local economy and creation of employment opportunities through sustainable tourism projects.
The states have been given a timeline of two-years for completing the projects, whereas the funds will be released before March 2026, it added.
UP Govt Aims to Spur Gems, Jewellery Sector
The Uttar Pradesh (UP) state government spearheaded by Mr Yogi Adityanath is taking big steps to boost its gems and jewellery sector whose annual trade is estimated at over Rs 1-trillion. The government’s initiatives will focus on economic value-additions and export growth.
An important point to be noted here is that more than one-million traders, retailers, craftsmen and designers are directly involved in this sector, which spans manufacturing and exports.
Major hubs in the state include Meerut, Lucknow, the NOIDA Export Processing Zone, Moradabad, Kanpur and Agra.
What requires highlighting here is that the government has drafted a blueprint to develop Meerut as a major jewellery manufacturing and trading hub of north India.
Meerut’s jewellery industry generates an annual turnover of over Rs 2,000-crore and employs approximately 40,000 goldsmiths, gemstone makers and jewellery traders.
“The proposed hub, spanning 32,000 sq mtrs, would position Meerut as a key centre for gems, precious stones and gold jewellery,” a senior Uttar Pradesh government official was quoted in the media as saying.
The state government plans to construct a modern multi-storey flatted factory complex to foster business growth and give a leg-up to start-ups in the gems and jewellery sector.
The organised segment of the gems and jewellery trade in the state accounts for about 35 per cent of the overall Rs 1-trillion market.
The gems and jewellery sector contributes 10-to-12 per cent of the country’s total merchandise exports and ranks among the country’s top commodity segments.
Last year (2023), the domestic market for gems and jewellery was valued at USD 92-billion.
India, ADB Ink USD 98-mn Loan Agreement
India and the Asian Development Bank (ADB) have inked a USD 98-million loan agreement to bolster horticulture crop productivity in the country.
The funding will support the establishment of disease-free planting material systems, boosting crop yields, quality and resilience to climate change, the ministry of finance said,
The loan agreement, a part of the Building India’s Clean Plant Programme was inked by Juhi Mukherjee, Joint Secretary, Department of Economic Affairs, Ministry of Finance and Kai Wei Yeo, Officer-in-Charge of ADB’s India Resident Mission.
“ADB funding will promote plant health that is vital for improving productivity of farmers,” Juhi Mukherjee said.
The ADB official Kai Wei Yeo said that the project aligned with the Government of India (GoI)’s Atmanirbhar Clean Plant Programme (CPP) which focuses on improving plant health management.
As per the ministry, the project aims to establish clean plant centres equipped with state-of-the-art laboratories for disease diagnostics and staffed by trained experts.
India’s Real Estate Sector Set to Cross USD 4.8-tn by 2047
India’s real estate sector is set to be an USD 4.8-trillion-plus market by 2047, contributing 18 per cent to the projected USD 26-trillion GDP.
This was stated in a joint report by EY and the Confederation of Real Estate Developers’ Associations of India (CREDAI), released in end-November.
Here, it must be pointed out that presently, the real estate sector contributes seven per cent to the country’s GDP.
According to the report, the growing proptech segment will breach the USD 600-billion mark in market size by 2047 and constitute 12-to-13 per cent of the real estate industry as a whole.
The report further sad that it is the validation of the on-going and projected tech revolution given that currently proptech makes up less than five per cent of the USD 300-billion real estate sector.
It highlighted how innovations like Artificial Intelligence (AI), Internet of Things (IoT) and building information modelling (BIM) are transforming operations, enhancing efficiency and ensuring transparency across the real estate value chain.
Pointing out that India’s real estate sector has consistently been a key economic pillar and is set to grow in prominence over the next decade, the report said that macro-level infrastructure initiatives, including the National Infrastructure Pipeline (NIP) and PM Gati Shakti, are closely linked to this growth.
Infrastructure projects spanning roads, railways, airports and ports are unlocking opportunities in adjacent real estate markets and Tier II and Tier III cities are now emerging as new real estate investment hubs.