In a significant development, India's economic growth decelerated to 5.4% in the July-September quarter of the current fiscal year, marking its slowest pace in nearly two years. This is a significant drop from the 8.1% growth recorded in the same period last year, as per official data released on Friday.
Despite the slowdown, India retained its position as the fastest-growing major economy, surpassing China's 4.6% GDP growth in the same quarter.
The last time GDP growth fell below this level was in the October-December quarter of FY2023, when it dipped to 4.3%.
Key sectoral insights
According to data from the National Statistical Office (NSO), the Gross Value Added (GVA) for the agriculture sector surged to 3.5% in Q2 FY2024, up from 1.7% in the corresponding quarter last year. In contrast, the manufacturing sector's GVA growth plunged to 2.2%, a sharp decline from the robust 14.3% growth recorded in the year-ago period.
The slowdown in manufacturing emerged as the primary drag on overall economic growth, raising concerns about the sector's recovery amidst global economic headwinds.
Performance in H1 FY2024
During the first half of FY2024 (April-September), India's GDP growth stood at 6%, down from 8.2% in the same period of the previous fiscal year. However, the GDP growth for the first quarter (April-June 2024) was confirmed at 6.7%, remaining unchanged from earlier estimates.
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