With the Government’s reforms as well as incessant effort made by the central bank, country’s economic growth picked up the pace and reached at 7.4 per cent in the July-September quarter, overtaking China as the world’s fastest growing major economy, following increasing the activities in manufacturing, mining and services sectors.
The good sign of recovery in the GDP has followed a series of rate cuts announced by the Reserve Bank of India (RBI) in recent months and bolstered the case for the central bank to hold onto its rate at its scheduled monetary policy review meeting on Tuesday.
A new method introduced by the Central Statistics Office (CSO) - the gross value added (GVA) - 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 gross domestic product or 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 the CSO data released on Monday.
However, the growth rate for the latest quarter was far below 8.4 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, while Russia contracted by 4.1 per cent and Brazil forecast to be shrank 4.2 per cent in the same period.
According to the statement, the economic activities which registered growth of over 7 per cent in the second quarter are trade, hotels and transport and 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.
According to the official data, the growth in the output of electricity, gas, water supply and other utility services decelerated to 6.7 per cent in July-September quarter as against 8.7 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 Rs27.57 lakh crore, as against Rs25.66 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 Rs25.80 lakh crore, as against Rs24.02 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