GDP growth dips to 5.4 pc in Q2, below RBI estimate

New Delhi (thestates.news)| India’s gross domestic product (GDP) growth slowed down to 5.4% year-on-year in the July-September quarter of current financial year 2024-25, falling short of Reserve Bank of India’s estimate of 7%. The Indian economy had registered 6.7% growth in the April-June quarter (Q1) of the current financial year and 8.1% in the Q2 of previous financial year 2023-24.

“Real GDP or GDP at Constant Prices in Q2 of 2024-25 is estimated at Rs 44.10 lakh crore, against Rs 41.86 lakh crore in Q2 of 2023-24, showing a growth rate of 5.4%,” said Ministry of Statistics & Programme Implementation in an official release on Friday. As per the official data, real gross value added (GVA) grew by 5.6% in Q2 of FY 2024-25 over the growth rate of 7.7% in Q2 of the previous financial year.

While agriculture & allied sector bounced back by registering a growth rate of 3.5% in Q2 of FY25, manufacturing sector grew at a sluggish pace of 2.2%. Mining & quarrying sector contracted marginally by 0.1% during this period.

Labour-intensive construction sector grew at 7.7% in the September quarter of the current fiscal. Trade, hotels, transport, communication & services related to broadcasting saw a growth rate of 6% in Q2 of FY25 over the growth rate of 4.5% in the corresponding period of previous financial year.
“GDP growth dipped much sharper than expected to a tepid 5.4% in Q2 FY2025, with a number of sectors throwing up negative surprises, especially the anemic outturn of manufacturing growth and the marginal contraction in mining, as well as a slower than projected growth of the services sector,” said ICRA chief economist Aditi Nayar while commenting on GDP data.

The official data showed private final consumption expenditure (PFCE), the biggest engine of the economy, witnessed a growth rate of 6% in the second quarter of the current fiscal.
“Government final consumption expenditure (GFCE) has rebounded to a growth rate of 4.4% after observing either negative or low growth rates in previous three quarters,” MoSPI said in its statement.

Real GDP in April-September of 2024-25 (H1 FY25) is estimated at Rs 87.74 lakh crore, against Rs 82.77 lakh crore in H1 of 2023-24, showing a growth rate of 6.0%. Nominal GDP or GDP at current prices in H1, 2024-25 is estimated at Rs 153.91 lakh crore, against Rs 141.40 lakh crore in H1 of 2023-24, showing a growth rate of 8.9%. (UNI)