GDP growth may ease to 7.2% in July-September quarter on sluggish economy, says Icra report; data to be out on 30 November

It can be noted that the GDP had grown by a higher than expected 8.2 percent in the first quarter of the fiscal as compared to the year-ago period. Official data on quarterly growth will be released at the end of this month.

Press Trust of India November 21, 2018 11:55:45 IST
GDP growth may ease to 7.2% in July-September quarter on sluggish economy, says Icra report; data to be out on 30 November

Mumbai: After the strong upswing in April-June quarter, GDP growth for July-September is expected to dip to 7.2 percent due to sluggishness in agriculture and industry, a report said on Tuesday.

It can be noted that the GDP had grown by a higher than expected 8.2 percent in the first quarter of the fiscal as compared to the year-ago period. Official data on quarterly growth will be released at the end of this month.

The dip in the growth number will be largely on account of a pull down from industry where growth is expected to slow down to 7.1 percent in the September quarter as compared to 10.3 percent in June and the farm sector, which may slow down to 3.5 percent from 5.3 percent, domestic rating agency Icra said in a report.

GDP growth may ease to 72 in JulySeptember quarter on sluggish economy says Icra report data to be out on 30 November

Representational image. Reuters.

Higher fuel prices and the weak rupee were pointed out as the primary factors dragging the industrial growth, while an uneven and sub-par monsoon, flooding in some areas amid a late withdrawal of the monsoon rains, and instances of crop damage and pest attacks will impact the farm sector.

Its principal economist Aditi Nayar said pre-tax margins for companies have declined on a quarter-on-quarter basis because of a rise in the input and energy costs and the rupee depreciation.

"Overall, we expect manufacturing GVA (gross value added) growth to ease to 7.0 percent in Q2FY19 from the healthy 13.5 percent expansion in Q1FY19," she said.

The agency said higher commodity prices may support a shallow recovery in GVA growth in mining and quarrying from the marginal 0.1 percent in Q1FY19 to around 2.5 percent in Q2FY19, despite a slowdown in volume growth.

Similarly, electricity, gas, water supply and other utility services and construction activity will also show an upswing due to a variety of sectoral factors, it said.

On agriculture, the agency said the first advance estimates of crop production indicated a decline in kharif output in FY2019 for pulses, coarse cereals, and cotton, and a rise in oilseeds, sugarcane and rice.

The services sector growth is expected to rebound to 7.8 percent for the September quarter from the 7.3 percent in the first quarter, led by a sharp pickup in the expansion in the Centre's non-interest revenue expenditure and a mild rise in growth of bank deposits.

Updated Date:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

SC stays farm laws but forms expert panel to ease negotiations; farmers say no talks, only repeal
India

SC stays farm laws but forms expert panel to ease negotiations; farmers say no talks, only repeal

The farmers have not only categorically refused to engage with the said 'expert panel', which includes two domain experts and two farmer leaders, but have also asserted that their tractor march on Republic Day will be held as per schedule

Union Budget 2021: Govt must redirect focus on resolving demand-side issue for economic recovery
India

Union Budget 2021: Govt must redirect focus on resolving demand-side issue for economic recovery

Sunil Kumar Sinha of India Ratings warned that even if the supply-side bottlenecks get restored on account of various RBI measures it may soon run into difficulties due to the lack of adequate demand

Union Budget 2021: US business advocacy group urges Nirmala Sitharaman to lower tariff to compete with RCEP
World

Union Budget 2021: US business advocacy group urges Nirmala Sitharaman to lower tariff to compete with RCEP

India had walked out of the RCEP, a 14-member group led by China, as negotiations failed to address New Delhi's outstanding issues and concerns