India’s Gross Domestic Product grew by 5.4% in the October-December quarter and is likely to expand at 8.9% in 2021-’22 financial year, government data showed on Monday. During the second quarter (July-September) of the 2021-’22, the economy grew by 8.4%.
In its first advance estimates released in January, the National Statistical Office had projected 9.2% growth for 2021-’22 as against a contraction of 6.6% in 2020-’21.
The growth in October-December quarter is lower than the previous quarter because of drop in growth in agriculture, mining, construction and manufacturing sectors.
The construction sector recorded a sharp drop in growth, clocking -2.8% in the third quarter of current financial year as against a growth of 8.2% in the second quarter, data showed.
Agriculture sector grew at 2.6% in the October-December quarter, compared to 3.7% in previous quarter. Mining grew by 8.8% compared to 14.2% in the preceding quarter, while manufacturing sector witnessed a growth of 0.2% compared to 5.6% in the last quarter.
“Sluggishness in momentum could spill over to Q4 due to temporary impact from Omicron-related disruption and minor adverse impact of Russia-Ukraine crisis via the trade channel,” Vivek Kumar, economist, Quanteco Research, told Reuters before the figures were released on Monday. “Some of these risks could get offset by back-loaded government spending and the persistence of accommodative monetary policy.”
Another set of data on Monday also showed that the output of India’s eight core sectors grew by 3.7% compared to the same period a year ago. The production in core infrastructure sectors, which accounts for nearly 40% of industrial output, rose by 11.6% year on year over the April-January period, the government data said.
In the April-June quarter of 2021-’22, the economy grew by 20.1%. However, it was built on a low base after an unprecedented contraction of 24.4% in the corresponding three months of the previous fiscal year.