- FY20Q1 growth fell to its slowest pace since March 2013 amid a prolonged slowdown in few sectors
- GDP growth was impacted by the slowdown in manufacturing, agriculture and construction sectors, which witnessed year-on-year deceleration in growth
- Services sector, the biggest contributor to the GDP, grew at 5.9% as against 6.5% in the year-ago quarter
In a sign that the economy is going through a prolonged slowdown phase, the Central Statistical Office
on Friday said that GDP growth for the April-June quarter of current financial year, slowed to 5%, its slowest pace in over six years. It was the weakest growth rate since the first quarter of 2013.
The Indian economy grew 5% annually in first quarter of FY2020, slowing from a 5.8% growth in the march, missing market expectations. According to a poll of economists done by ETNow, India's economy was expected to grow at 5.6% in Q1.
The moderation in GDP growth is in line with industrial production growing at 3.6% in the first quarter compared with 5.1% expansion in the year-ago quarter. High-frequency indicators such as automobile sales, rail freight, domestic air traffic and imports (non-oil, non-gold, non-silver and non-precious and semi-precious stones) indicated a slowdown in consumption, especially private consumption, even with low inflation.
In nominal terms, GDP at (2011-12) prices is estimated at Rs 35.85 lakh crore as against Rs 34.14 lakh crore in Q1 of 2018-19, the CSO said in a statement. Quarterly GVA at basic price at constant (2011-12) prices for Q1 of 2019-20 is estimated at Rs 33.48 lakh crore, as against Rs 31.90 lakh crore in Q1 of 2018-19, showing a growth rate of 4.9% over the corresponding quarter of previous year, the statistics department said.
According to the data published by the government, overall GDP growth was impacted by the slowdown in manufacturing, agriculture and construction sectors, which witnessed year-on-year deceleration in growth.