GDP growth slows to five-quarter low of 6.6% in Q3 on weak performance of agriculture and manufacturing sector

Earlier last month, the CSO had estimated GDP growth of 7.2 percent for this fiscal under its first advance estimates.

FP Staff February 28, 2019 18:08:17 IST
GDP growth slows to five-quarter low of 6.6% in Q3 on weak performance of agriculture and manufacturing sector
  • Growth estimate has been lowered to 7 percent for 2018-19 from 7.2 percent released earlier, said Central Statistics Office

  • GVA for the third quarter has been estimated to grow at 6.3 percent as against 6.8 percent in the second quarter of the current fiscal

  • The agriculture sector is estimated to grow at 2.7 percent in the third quarter as against 4.2 percent in the second quarter

India's economic growth slowed to a 5-quarter low of 6.6 percent in the October-December period of this fiscal, according to government data released on Thursday.

The Gross Domestic Product (GDP) at constant prices (2011-12) had grown at 7.7 per cent in the October-December quarter of the previous financial year.

Also, growth estimate has been lowered to 7 percent for 2018-19 from 7.2 percent released earlier, said Central Statistics Office.

Gross Value Added (GVA) for the third quarter has been estimated to grow at 6.3 percent as against 6.8 percent in the second quarter of the current fiscal and 7.3 percent in the corresponding quarter of the previous year.

GDP growth slows to fivequarter low of 66 in Q3 on weak performance of agriculture and manufacturing sector

Representational image. Reuters.

"GDP at Constant (2011-12) Prices in Q3 of 2018-19 is estimated at Rs 35.00 lakh crore, as against Rs 32.85 lakh crore in Q3 of 2017-18, showing a growth rate of 6.6 percent.

"GDP growth rates for Q1 and Q2 of 2018-19 at Constant Prices are 8.0 percent and 7.0 percent respectively," the Central Statistics Office (CSO) said in a statement.

Earlier last month, the CSO had estimated GDP growth of 7.2 percent for this fiscal under its first advance estimates.

The agriculture sector is estimated to grow at 2.7 percent in the third quarter as against 4.2 percent in the second quarter and 4.6 percent of Q3 FY2018. Manufacturing growth is estimated to slow to 6.7 percent in the third quarter against 6.9 percent in the second quarter and 8.6 percent of Q3 FY2018.

The construction sector is expected to grow at 9.6 percent in the third quarter compared to 8.5 percent in the second quarter and 8 percent in the corresponding quarter previous year.

GDP growth slows to fivequarter low of 66 in Q3 on weak performance of agriculture and manufacturing sector

The median forecast from more than 55 economists polled by Reuters on 19-25 February was for growth of 6.9 percent, compared with 7.1 percent in July-September.

“Consumption drivers should remain modest as tight liquidity persisted through most of the quarter and farm distress restrained rural consumption,” Charu Chanana, emerging Asia economist at Continuum Economics had said.

A slowdown in growth momentum supports the Reserve Bank of India’s sudden dovish turn in early February when it cut rates and changed its policy stance to “neutral” to boost expansion after a sharp fall in inflation.

However, global uncertainty over trade conflicts, Brexit and oil prices could add to growth headwinds in India, the RBI’s Monetary Policy Committee had said.

With inputs from agencies

Updated Date:

also read

Retail inflation jumps to 5.52% in March; factory output contracts 3.6% in February
Business

Retail inflation jumps to 5.52% in March; factory output contracts 3.6% in February

The manufacturing sector — which constitutes 77.63 percent of the IIP — declined by 3.7 percent in February 2021, as per NSO data

Amid COVID-19 case surge, leading brokerages downgrade India’s GDP forecast for FY22
Business

Amid COVID-19 case surge, leading brokerages downgrade India’s GDP forecast for FY22

While Nomura has downgraded projections of economic growth for the fiscal year ending March 2022 to 12.6 percent from 13.5 percent earlier, JP Morgan now projects GDP growth at 11 percent from 13 percent earlier

India's debt ratio to GDP increases from 74% to 90% during COVID-19: IMF
India

India's debt ratio to GDP increases from 74% to 90% during COVID-19: IMF

Vitor Gaspar, Director of IMF's Fiscal Affairs Department, said that widening deficits and contraction in economic activity, debt worldwide increased sharply to 97% of GDP in 2020