GDP growth cools down to 8.6% in Q3
GDP growth in the third quarter was relatively low at 8.6%, compared to 9.2% growth in the preceding quarter, and 8.9% in the corresponding previous period.
By TNN |
GDP growth in the third quarter was relatively low at 8.6%, compared to 9.2% growth in the preceding quarter, and 8.9% in the corresponding previous period. Dismal performance of agriculture and moderate growth in manufacturing cooled down the overall pace of growth. Growth in agriculture sector was merely 1.5% in quarter ended December 2006, lower from 1.7% in Q2’07 and 3.4% in Q1’07. Manufacturing growth was a bit slower at 10.7%, but still at healthy levels. Infrastructure sectors gained momentum and services continued their upward march.
The question that arises is whether the projected 9.2% growth is feasible. GDP growth in the last quarter will have to be 10% to achieve the target, which is a tough task considering that Q4’06 growth was 10% too, creating a high base effect. Assuming other sectors maintain their current trends, agriculture will have to grow 4.3% in Q4’07.
That seems a distant possibility, considering flat growth in agricultural production in ‘07. The Mar’ 06 quarter had seen agriculture grow by 6.3%, again creating a high base effect . Rabi crop arrivals are yet to reach full swing, so output estimates could be revised upwards. But even then, overall growth is unlikely to see a surprise.
Barring some unforeseen circumstances, like a revision of past data, attaining a 10% growth in GDP in the last quarter appears a big challenge.
The question that arises is whether the projected 9.2% growth is feasible. GDP growth in the last quarter will have to be 10% to achieve the target, which is a tough task considering that Q4’06 growth was 10% too, creating a high base effect. Assuming other sectors maintain their current trends, agriculture will have to grow 4.3% in Q4’07.
That seems a distant possibility, considering flat growth in agricultural production in ‘07. The Mar’ 06 quarter had seen agriculture grow by 6.3%, again creating a high base effect . Rabi crop arrivals are yet to reach full swing, so output estimates could be revised upwards. But even then, overall growth is unlikely to see a surprise.
Barring some unforeseen circumstances, like a revision of past data, attaining a 10% growth in GDP in the last quarter appears a big challenge.
Download
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
