New Delhi : Beating expectations and showing another sign of revival, the Indian economy expanded by 5.7 percent during the first quarter of the current financial year to log the highest growth yet in nine quarters or over two years, official data showed Friday.
The gross domestic product (GDP), which is the aggregate market value of all the goods and services produced in the country, had expanded by just 4.6 percent in the previous quarter, that is January-March, and by 4.7 percent in the like quarter of last fiscal.
The 5.7 percent growth in April-June quarter is also the highest since the 6 percent increase logged during October-December quarter of 2011-12, as per data compiled by the Central Statistics Office (CSO).
The first quarter GDP growth has been boosted by a sharp turnaround in manufacturing as well as a good performance by mining and construction sector.
Agriculture sector output grew at 3.8 percent in April-June this year, slightly lower than 4 percent growth in same quarter last year.
Electricity output grew at a much improved 10.2 percent as compared to 3.8 percent in same quarter of the previous fiscal.
The construction sector grew at 4.8 percent, against 1.1 percent in the same period a year ago.
Private final consumption spending stood at Rs.930,000 crore versus Rs.880,000 crore year-on-year, while the government’s final consumption spend logged at Rs.180,000 crore against 170,000 crore.
While the release of the first quarter’s GDP numbers coincides with nearly a hundred days in office of the NDA regime, one cannot lose sight of the fact that almost two-thirds of the quarter passed under a lame-duck administration whose earlier policies would have provided the thrust to this change of gear in economic growth.
Indian industry was effusive in its praise of the numbers indicating economic recovery.
“The sharp rise in GDP growth to 5.7 percent, after remaining in the sub 5 percent range for the last two years, is noteworthy and reinforces faith in the India growth story,” Chandrajit Banerjee, director general, Confederation of Indian Industry (CII) said in a statement, commenting on GDP growth for the first quarter of the current year.
“In order to convert the first signs of revival into a full-fledged recovery, it is necessary that the government continues implementing the reforms agenda,” he added.
“GDP growth of 5.7 percent in Q1 is certainly above our expectations. It is a great news given the fact the numbers are the best in two years,” said Assocham president Rana Kapoor.
“The GDP data released today indicating a growth of 5.7 percent in Q1 FY15, vis-à-vis 4.6 percent increase in Q4 FY14, comes as a welcome breather and clearly points towards a pickup in economic activity. This momentum has to be carried forward with greater fervor,” said Sidharth Birla, president, Federation of Indian Chambers of Commerce and Industry (FICCI).