Economic growth rate contracts to 3.4 per cent in Q1: National Statistics Office

The NSO said the government has set the target of a 6 per cent economic growth rate in the current fiscal year and only a 3.4 per cent GDP growth rate has been achieved in the first quarter of the current fiscal year. The growth rate of 17 out of the 18 various sectors contributing to the economy is positive while that of the construction sector is in negative. Among them, electricity and gas-related activities have the highest growth rate of 21.4 per cent, while the transportation and storage sector is the second fastest-growing industrial sector with a growth rate of 6.7 per cent. Similarly, the value addition of accommodation and food service activities sector is estimated to grow by 6.3 per cent.

According to the preliminary estimate, the growth rate of the financial and insurance sector will be 5.7 per cent, the growth rate of administrative support service sector will be 5.4 per cent and the growth rate of professional scientific and technical services will be 5.1 per cent in the current fiscal year. It is estimated that the construction sector is shrinking slightly due to the decline in the import of construction goods in the first quarter of the current fiscal year.

The construction sector is negative by 0.3 per cent. The value-added growth rate of agriculture, forests and fishery sectors, which share the largest space in the country’s economy, is estimated to be three per cent. There is a positive impact on the total value addition of this sector following an increase in the production of summer crops including paddy as well as vegetables, cash crops and poultry products, it is said. Though agro products were expected to increase following the availability of chemical fertilizer, improved seed and sufficient monsoon rain, the total value-added growth rate of the agro sector could not increase sufficiently due to landslides and floods.

The wholesale and retail trade sector is estimated to grow by 0.5 per cent in the first quarter. According to the office, it is expected to increase the value-added growth rate of the industrial goods production sector by 2.3 per cent, the education sector by 0.4 per cent, the health sector by 4.1 per cent and the real estate sector by 3.1 per cent during the review period. The country’s overall economy is towards positive growth due to an increase in agro-production, power production and distribution, flow of tourists, reads the report.