New Delhi :India’s economic growth accelerated to 7.4 per cent in the July-September quarter, overtaking China as the world’s fastest growing major economy, on pick up in manufacturing, mining and services sectors.
The signs of recovery in the GDP, from a growth rate of 7 per cent in the previous quarter ended June 30, follows a series of rate cuts announced by the RBI in recent months and bolstered the case for the central bank to hold onto its rate at its scheduled monetary policy review meeting tomorrow.
However, the growth rate for the latest quarter was far below 8.9 per cent recorded in the July-September quarter of the previous fiscal.
Still, the GDP expansion by 7.4 per cent in the second quarter of the current fiscal bettered 6.9 per cent growth in China for the same period. Russia contracted by 4.1 per cent while it is forecast that Brazil may have shrank 4.2 per cent in the same period.
The Gross Value Added (GVA), a new concept introduced by CSO to measure the economic activity, also accelerated during the second quarter to 7.4 per cent, from 7.1 per cent in the April-June period.
The GDP grew at 8.4 per cent in the July-September quarter last year while it was 6.7 per cent in the April-June quarter last fiscal, according to data from the Central Statistics Office (CSO).
According to the statement, the economic activities which registered growth of over 7 per cent in the second quarter are trade, hotels and transport & communication and services related to broadcasting, financial, insurance, real estate and professional services and manufacturing.
The government had projected a growth rate of 8.1-8.5 per cent for the current fiscal.
The data showed that the manufacturing sector GVA at constant prices (2011-12) rose 9.3 per cent in July-September quarter as against 7.9 per cent in the year-ago period.
The output of mining and quarrying sector rose to 3.2 per cent, from 1.4 per cent a year ago.
The trade, hotel, transport, communication and services related to broadcasting segment grew at 10.6 per cent in the quarter under review compared to 8.9 per cent year ago.
Financial, real estate and professional services growth shrank to 9.7 per cent against 13.5 per cent a year earlier.
The farm and allied sectors grew at 2.2 per cent in the second quarter, up from 2.1 per cent in the previous year.
The construction activity registered an increase of 2.6 per cent, down from 8.7 per cent in the previous year.
The data showed that the GDP at constant (2011-12) prices in the second quarter of 2015-16 is estimated at Rs 27.57 lakh crore, as against Rs 25.66 lakh crore in the same period of 2014-15, showing a growth rate of 7.4 per cent.
Quarterly GVA at Basic Price at constant (2011-12) prices for the September quarter of 2015-16 is estimated at Rs 25.80 lakh crore, as against Rs 24.02 lakh crore in the second quarter of 2014-15, showing a growth rate of 7.4 per cent over the corresponding quarter of previous year, the statement said.
According to the CSO data, the GDP in the first half of this fiscal grew at 7.2 per cent compared to 7.5 per cent in same period of of 2014-15.
The GVA at constant prices (2011-12) grew at 7.2 per cent in the April-September period as compared to 7.9 per cent in previous year.
As per the data, Gross Fixed Capital Formation (GFCF) at current prices is estimated at Rs 9.24 lakh crore in the second quarter of 2015-16 as against Rs 8.89 lakh crore in the same period of 2014-15.
Gross Fixed Capital Formation (GFCF) refers to net addition of fixed capital such as land improvements; plant and machinery; equipment purchases; and construction of roads, railways, schools, offices, hospitals, private residential dwellings and commercial properties.
At constant (2011-2012) prices, the GFCF is estimated at Rs 8.31 lakh crore in the quarter of 2015-16 as against Rs 7.78 lakh crore in the September quarter of 2014- 15.