ECONOMY
Q1 FY25 GDP growth slows to 15-month low at 6.7% on poor show by farm, services
- IBJ Bureau
- Aug 31, 2024
India’s economic growth slowed to a 15-month low of 6.7 per cent in April-June 2024-25 (Q1 FY25), mainly due to poor performance of agriculture and services sectors, government data showed on Friday.
The Gross Domestic Product (GDP) had expanded by 8.2 per cent in the April-June quarter of 2023-24.
India, however, remained the fastest-growing major economy, as China posted a 4.7 per cent growth in April-June 2024.
The previous low of 6.2 per cent for India’s GDP was recorded in the January-March quarter of 2023.
“India’s GDP growth expectedly slowed down in Q1 FY2025 relative to Q4 FY2024 (to a five-quarter low of 6.7 per cent from 7.8 per cent), even as the GVA growth surprisingly accelerated between these quarters (to 6.8 per cent from 6.3 per cent), said ICRA Chief Economist Aditi Nayar. She further added: “This divergent trend was led by the normalisation of the growth in net indirect taxes, and the slowdown in the GDP growth is not a cause for alarm, in our view.”
According to the National Statistical Office (NSO) data, agriculture sector Gross Value Added (GVA) growth decelerated to 2 per cent from 3.7 per cent in the April-June quarter of 2023-24.
Expansion in financial, real estate and professional services GVA too slowed to 7.1 per cent from 12.6 per cent in the year-ago quarter.
However, GVA in the manufacturing sector accelerated to 7 per cent in the first quarter of the current fiscal compared to 5 per cent a year ago.
“Real GDP or GDP at constant prices in Q1 of 2024-25 is estimated at Rs 43.64 lakh crore against Rs 40.91 lakh crore in Q1 of 2023-24, showing growth rate of 6.7 per cent,” NSO said in a statement.
It further stated that nominal GDP or GDP at current prices in Q1 of 2024-25 is estimated at Rs 77.31 lakh crore against Rs 70.50 lakh crore in Q1 of 2023-24, showing growth rate of 9.7 per cent.
According to the data, the output (GVA) in mining and quarrying accelerated to 7.2 per cent in the first quarter from 7 per cent a year ago.
Electricity, gas, water supply and other utility services grew by 10.4 per cent from 3.2 per cent.
The construction segment also grew by 10.5 per cent from 8.6 per cent a year ago.
Trade, hotels, transport, communication and services related to broadcasting slowed to 5.7 per cent from 9.7 per cent a year ago.
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