Between Q1 India GDP numbers: Green shoots and red flags

Aug 30 2014, 08:05 IST
Comments 0
India's manufacturing output was up 3.5 per cent in the first quarter this fiscal as against a contraction of 1.2 per cent a year ago. India's manufacturing output was up 3.5 per cent in the first quarter this fiscal as against a contraction of 1.2 per cent a year ago.
SummaryAt 5.7%, India's GDP grows fastest in over two years years; manufacturing output up 3.5%.

Led by strong industrial activity and a better-than-expected agricultural performance, the economy grew at a rate of 5.7 per cent in the quarter ended June, its fastest pace in two-and-a-half years, according to government data released on Friday.

GDP growth was 4.7 per cent in the corresponding quarter a year ago. Economic growth has been largely subdued marked by sub-5 per cent growth for the last two fiscals, with growth during the fourth quarter of last fiscal (January-March 2014) coming in at 4.6 per cent.

Here are positives and negatives on the GDP growth surge:

GREEN SHOOTS

* Early signs of a cyclical uptick in the broader economy

* A better-than-expected agricultural performance

* Visible surge in export growth during June quarter

* Energy, civic sector output exhibited a sharp pick-up

RED FLAGS

* Surge aided by a favourable base effect, including for manufacturing, power

* Moderation in services, especially financial and community services

* Delay in kharif sowing could reflect in lower agricultural output in Q2FY15

* Slowdown in electricity expected in coming quarters due to coal shortage

Ads by Google
Reader´s Comments
| Post a Comment
Please Wait while comments are loading...