Mumbai: Reserve Bank governor Shaktikanata Das expects the growth to pick up from the second quarter as the government spending has gained momentum now.
In the first quarter, the GDP grew at the slowest pace in as many as 25 quarters at 5 percent-which is even lower than that of Pakistan’s 5.4 per cent.
Das addressing an India Today event here said in the first quarter the government expenditure, which has a major role in GDP numbers, was very low due to the elections, pulling down the growth numbers to some extent.
“From the second quarter government expenditure has been picked up. So second quarter numbers will be hopefully better than the first quarter,” Das said.
He said for the first quarter, the RBI analysis showed growth to be at 5.8 percent and all the surveys it did also projected growth to be in the range of 5.5-5.8 percent but the final print was much lower.
“When it came in at 5 per cent it was a surprise. That is perhaps due to conflicting signals in the economy. One month the PMI goes up, the next month it goes down. The IIP numbers have also been going up and down.
“So, there are various other dataprints on which you build your estimates that go in conflicting directions and giving conflicting signals and that makes the task more complex,” he explained. But he was quick to add that the explanation is not an excuse.
On the crippled NBFC sector which have been facing liquidity crisis for a year now, he said the RBI is very closely monitoring the top 50 NBFCs, which account for roughly 75 percent of the loan outstanding of the industry.
“It is a very close monitoring that we are doing,” the governor added.
When queried about the stress in the NBFC sector and is RBI looking at an asset quality review of the industry, Das said there is no such
“The NBFC sector is a much larger universe compared to banks. A general asset quality review of the sector is one issue on which we have not really thought of,” he said.