India’s GDP growth dips to 9-year low of 5.3 percent (Lead)May 31st, 2012 - 3:39 pm ICT by IANS
New Delhi, May 31 (IANS) India’s economic growth slumped to 5.3 percent in January-March quarter, the slowest in nine years, due to poor performance of manufacturing and farm sectors, official data showed Thursday.
For the whole of 2011-12 financial year, the gross domestic product (GDP) growth slumped to 6.5 percent. This is the slowest pace of expansion in the country’s economy since 2002-03, when it had registered a growth of just 4 percent.
“This is the lowest in the contemporary period. It has been substantially down because of the very poor performance of manufacturing sector,” Finance Minister Pranab Mukherjee told reporters while reacting on the data.
During January-March 2012 quarter, manufacturing sector contracted by 0.3 percent as against a growth of 7.3 percent registered during the corresponding period of previous year.
“Because of the manufacturing sector, the overall growth of the GDP has come down substantially,” the finance minister said.
The GDP growth data is down from the government’s estimate of 6.9 percent announced earlier this year, and sharply down from the previous year’s growth of 8.4 percent.
The GDP at factor cost at constant (2004-05) prices in the year 2011-12 is now estimated at Rs.52,02,514 crore as against Rs.52,22,027 crore estimated earlier on Feb 7, 2012, showing a growth rate of 6.5 per cent, the Central Statistics Office (CSO) said.
In the quick estimate of GDP released in February, the CSO had projected 6.9 percent growth for 2011-12.
“The downward revision in the GDP growth rate is mainly on account of lower performance in ‘manufacturing’ and ‘trade, hotels, transport and communication’ than anticipated,” the CSO said.
Economic policy makers as well as industry bodies have termed the data disappointing and shocking.
“This is obviously disappointing. Decline in industrial production has not been offset by growth in agricultural production,” said C. Rangarajan, chairman of the Prime Minister’s Economic Advisory Council.
Rangarajan said farm sector was likely to do better this year on the back of good monsoon.
“This is the fourth straight quarter of decline and quarterly growth dipped to the same level during Q3 of 2008-09 (5.6%). Nevertheless, this decline in growth is not surprising as FICCI had forewarned in April that the Q3 growth did not represent the bottoming out of the economy,” said Rajiv Kumar, secretary general, Federation of Indian Chambers of Commerce and Industry (FICCI).
“The manufacturing sector growth has slumped to (-) 0.3 percent in fourth quarter and 2.5 percent for the year as a whole. This will severely pull down services sector growth in the coming quarters,” he noted.
“The current global situation remains fragile and all steps need to be taken on the domestic front to guard against such uncertainties,” Kumar said.
- India's economic growth dips to 9-year low of 5.3 percent (Roundup) - May 31, 2012
- India's economic growth slumps to 6.5 percent in 2011-12 - May 31, 2012
- Indian economy grows at a sluggish 5.5 percent in Q1 (Lead) - Aug 31, 2012
- Indian economy may grow at 8 percent in 2012-13: Rangarajan (Lead) - Feb 22, 2012
- Factors leading to slowdown have bottomed out: Mukherjee - May 31, 2012
- Economic growth revised upwards to 7.1 percent - Feb 22, 2012
- India downgrades 2011-12 economic growth to 7.5 percent - Dec 09, 2011
- Government blames domestic economic woes on global uncertainties (Roundup) - Dec 09, 2011
- Rising raw material cost dampening manufacturing growth: Ficci - Dec 11, 2011
- Quick decisions needed to boost investments: Chidambaram - Aug 31, 2012
- Indian economy to grow by 6.9 percent this fiscal (Lead) - Feb 07, 2012
- Economic growth falls to 3-year low at 6.1 percent (Roundup) - Feb 29, 2012
- Indian economy grows slowest in six quarters (Roundup) - Aug 30, 2011
- Indian economy's growth slows to 5.5 percent in first quarter - Aug 31, 2012
- Industrial output grows 4.1 percent; rate cut possible (Lead) - Apr 12, 2012
Tags: agricultural production, c rangarajan, central statistics office, crore, cso, dips, downward revision, economic growth, economic policy makers, farm sectors, finance minister, gdp, gdp growth rate, gross domestic product, industry bodies, manufacturing sector, nine years, poor performance, pranab mukherjee, previous year