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GDP growth for second quarter tops 9 per centnews
Rex Mathew
30 November 2006

Helped by double digit growth in manufacturing and select services, GDP growth for the July – September quarter has come in at 9.2 per cent, much better than consensus estimates of around 8.9 per cent. GDP growth was 8.4 per cent during the same quarter of previous year and 8.9 per cent for the first quarter of current year.

Economic growth for the first 6 months of the current financial year has also crossed 9 per cent, to 9.1 per cent. If the present momentum continues, which is very likely, the Indian economy would clock an annual growth of over 9 per cent for the first time ever this year.

Among various industry groupings, trade, hotels, telecom and transportation have clocked a growth of 13.9 per cent for the quarter. Cargo handled by railways went up by 8.2 per cent, while passenger volume growth was 14.2 per cent. Production of commercial vehicles went up by 31.1 per cent while air passenger traffic increased by 27.7 per cent. Growth in the telecom sector remained very strong, expanding 49.9 per cent.

Bank deposits increased by 19.7 per cent, while advances by banks went up at a faster 29.7 per cent. The central government also chipped in increasing its expenditure by 19.4 per cent.

Construction expanded at 9.8 per cent, while growth in finance, real estate and business services was at 9.5 per cent. Among key construction indicators, cement output increased 10.4 per cent while production of steel went up by 7.6 per cent.

Manufacturing turned in a very strong performance with 11.9 per cent growth while output of electricity, gas and water supply recovered substantially to 7.7 per cent, from 2.6 per cent during the pervious year quarter and 5.4 per cent for the first quarter. Mining output growth improved to 3.1 per cent from a decline of 2.4 per cent during the previous year quarter.

However, agriculture output declined to 1.7 per cent from 4 per cent for the previous year quarter and 3.4 per cent during the first quarter. The situation may not improve much during the rest of the year as production of rice, oil seeds and coarse cereals are forecast to decline during the current khariff season. Output of pulses, cotton and sugarcane is expected to increase this season.

GDP at constant prices for the second quarter is estimated at Rs647,290 crore. GDP at current prices went up by 14 per cent to Rs838,367 crore for the quarter. For the first half, GDP at constant prices is estimated at Rs1,303,353 crore while GDP at current prices is estimated at Rs1,673,312 crore.

Quarterly estimates of GDP for Q2 (July-September) of 2006-07 at constant (1999-2000) prices

 

 

Industry

(Rs. in crore)
Gross Domestic Product

Percentage change
over previous year

2004-05

2005-06

2006-07

2005-06

2006-07

Q1

Q2

Q1

Q2

Q1

Q2

Q1

Q2

Q1

Q2

1. Agriculture, forestry and fishing

117,804

93,249

121,804

96,961

125,937

98,589

3.4

4.0

3.4

1.7

2. Mining and quarrying

12,392

12,204

12,771

11,890

13,202

12,254

3.1

-2.6

3.4

3.1

3. Manufacturing

83,286

88,162

92,229

95,318

102,630

106,621

10.7

8.1

11.3

11.9

4. Electricity, gas and water supply

13,010

13,335

13,970

13,688

14,724

14,742

7.4

2.6

5.4

7.7

5. Construction

35,937

37,028

40,402

41,592

44,249

45,676

12.4

12.3

9.5

9.8

6. Trade, hotels, transport and communication

138,390

141,203

154,642

156,721

175,025

178,459

11.7

11.0

13.2

13.9

7. Financing, ins., real est. and business services

77,245

77,505

84,021

85,662

91,527

93,825

8.8

10.5

8.9

9.5

8. Community, social and personal services

77,009

84,121

82,637

90,821

88,770

97,122

7.3

8.0

7.4

6.9

GDP at factor cost

555,074

546,807

602,476

592,652

656,063

647,290

8.5

8.4

8.9

9.2


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GDP growth for second quarter tops 9 per cent