Data released by the National Statistical Office (NSO) showed that the country’s GDP increased by 13.5% annually in the April-June quarter of the current fiscal year, higher than 4.1% in the previous quarter, but less than 20.1% recorded in the first quarter of 2021-22. Growth of 13.5% was lower than the Reserve Bank of India’s estimate of 16.2% for the first quarter of 2022-23.
Economists said that investment continued to improve in the June quarter on government spending on capital expenditure on infrastructure. But the estimates showed GDP growth 3.8% compared to the pre-pandemic period of the first quarter of fiscal 2020.
The growth of the agricultural sector it was solid at 4.5% in the June quarter, while the service sector was up 17.6%. Private consumption grew by 25.9%.
Gross fixed investment also remained solid, highlighting a recovery in domestic investment. The manufacturing sector growth was 4.8% in the June quarter compared to 49% in the quarter a year ago. The mining, manufacturing and electricity sectors showed weaknesses and followed economists’ expectations.
Finance secretary Somanathan TV said the numbers are fully consistent with the estimated 7-7.5% GDP growth for the year.
“Gross fixed capital formation (used to measure investment in the economy) and private consumption were very strong in the first quarter, which bodes well for the economy. Other high-frequency data are also showing good growth.” Economic Affairs Secretary Ajay Seth said. He also said that the base effect was at stake for contact-intensive sectors such as travel and tourism, while manufacturing activity increased after the 2020 lockdown and was not very significantly affected during. the wave of the delta.
At the current level, India’s first quarter GDP growth it is far above other large economies. China’s GDP growth in the first quarter was 4.8% as several key sectors such as real estate were hit and the economy was grappling with several other stresses. India is expected to be the fastest growing large economy amid the global slowdown.
“Post-pandemic favorable winds substantially increased GDP in the first quarter of fiscal year 23 – even if we were to discard the base low, this marks a stellar increase in sequential momentum. Contact-intensive services, public investment pushes and the delayed impact of favorable financial conditions, ”according to Aurodeep Nandi, an Indian economist and vice president of the Japanese investment bank Nomura.
