India's Real Gross Domestic Product (GDP) has been estimated to grow by 6.7 per cent in Q1 of FY 2024-25 over the growth rate of 8.2 per cent in Q1 of FY 2023-24, according to the latest official data released on Friday. The Real GDP accounts for inflation and provides a measure of the economy's actual output. The GDP slowed to a five-quarter low in April-June this fiscal against 8.2 per cent in the year-ago period, mainly due to poor showing by the farm sector, according to government data.
Agriculture sector records growth
As per the government data, the agriculture sector recorded a 2 per cent growth, down from 3.7 per cent in the April-June quarter of 2023-24, as per the National Statistical Office (NSO) data released on Friday. However, the growth in the manufacturing sector accelerated to 7 per cent in the first quarter of the current fiscal compared to 5 per cent in the year-ago period.
Key Highlights:
- Real GDP grew at 6.7% in Q1 of FY 2024-25 over the growth rate of 8.2% in Q1 of FY 2023-24.
- Nominal GDP has witnessed a growth rate of 9.7% in Q1 of FY 2024-25 as compared to the growth rate of 8.5% in Q1 of FY 2023-24.
- Real GVA has grown by 6.8% in Q1 of FY 2024-25 over the growth rate of 8.3% in Q1 of the previous financial year. This GVA growth in the Q1 of FY 2024-25 has been driven by significant growth in the Secondary Sector (8.4%), comprising of Construction (10.5%), Electricity, Gas, Water Supply & Other Utility Services (10.4%) and Manufacturing (7.0%) sectors.
- Growth rate in Nominal GVA for Q1 of FY 2024-25 have been estimated at 9.8% over 8.2% growth rate in Q1 of FY 2023-24.
- Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF), at Constant Prices, have witnessed growth rates of 7.4% and 7.5% respectively in Q1 of FY 2024-25.
- Net Taxes, at Current Prices, has observed the growth rate of 8.0 % in Q1 of FY 2024-25 resulting in 0.1% point gap between the growth rates of GVA and GDP.
IMF's projection for India's growth
In July, the International Monetary Fund (IMF) raised India's growth projections for 2024 from 6.8 per cent to 7 per cent, reinforcing the country's status as the fastest-growing economy among emerging markets and developing economies. The IMF had earlier projected a growth rate of 6.5 per cent for 2024, revising it to 6.8 per cent and now 7 per cent. It had attributed robustness and strength in domestic demand and a rising working-age population behind its growth projections.
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