India’s GDP growth more than halved to 6.3 percent in July-September from 13.5 percent in April-June, data released on November 30 by the Ministry of Statistics and Programme Implementation showed.
At 6.3 percent, the latest quarterly growth number is in line with the consensus estimate – and the Reserve Bank of India’s (RBI) own forecast – of 6.3 percent, as per a Moneycontrol poll.
In terms of Gross Value Added, or GVA, the growth in July-September was 5.6 percent, down from 12.7 percent in April-June and 8.3 percent in the same quarter last year.
In nominal terms, India’s GDP grew by 16.2 percent last quarter.
The sharp fall in GDP growth in July-September was due to the fading away of a favourable base effect. However, there were weak numbers in some of the sectors, with GVA of manufacturing contracting by 4.3 percent after having grown by 4.8 percent in April-June.
| BREAKDOWN OF GDP NUMBERS (GROWTH IN %) | |||
| JUL-SEP 2022 | APR-JUN 2022 | JUL-SEP 2021 | |
| Real GDP | 6.3% | 13.5% | 8.4% |
| Nominal GDP | 16.2% | 26.7% | 19.0% |
| Real GVA | 5.6% | 12.7% | 8.3% |
| Agriculture, forestry, fishing | 4.6% | 4.5% | 3.2% |
| Mining, quarrying | -2.8% | 6.5% | 14.5% |
| Manufacturing | -4.3% | 4.8% | 5.6% |
| Electricity, gas, other utilities | 5.6% | 14.7% | 8.5% |
| Construction | 6.6% | 16.8% | 8.1% |
| Trade, hotels, transport, etc | 14.7% | 25.7% | 9.6% |
| Financial, real estate, professsional services | 7.2% | 9.2% | 6.1% |
| Public administration, defence, other services | 6.5% | 26.3% | 19.4% |
There was also a surprise, albeit a positive one, with regards to the agricultural sector, whose GVA increased by 4.6 percent on a year-on-year basis in July-September, slightly up from a growth of 4.5 percent in the previous quarter.
Economists had expected the farm sector to perform less impressively given the uneven rainfall the country saw in July-September.
Services continued to perform well, with ‘Trade, Hotels, Transport, Communication & Services related to broadcasting’ posting a 14.7 percent increase in its GVA. Meanwhile, the GVA for ‘Financial, real estate, professional services’ rose by 7.2 percent, down from 9.2 percent in April-June.
On the expenditure side, July-September saw private final consumption expenditure grow by 9.7 percent, down from 25.9 percent growth in April-June and 10.5 percent a year ago. Meanwhile, gross fixed capital formation – a proxy for investments – rose by 10.4 percent.
Gross fixed capital formation had increased by 20.1 percent in April-June and 14.6 percent in the second quarter of FY22.
The latest data means India’s GDP has grown by 9.7 percent in the first half of FY23, down from 13.7 percent in April-September 2021. However, growth is expected to continue slowing down sharply in the second half of the year, with the RBI predicting it will come in at 4.6 percent in both October-December 2022 and January-March 2023.
For the full year, the central bank has forecast a growth rate of 7 percent.
