Indian economy shining brighter, posts 8.4 pc growth in Q2
Thursday, 01 January 2004, 20:30 IST
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NEW DELHI: The all-pervasive feel-good factor in the Indian economy received a further boost Wednesday with official figures showing that Asia's third largest economy posted sharply higher growth in the July-September quarter. India's gross domestic product (GDP) registered an impressive 8.4 percent growth in the quarter ended September, up from 5.7 percent logged in the first three months of fiscal 2003-04, according to figures from the Central Statistical Organisation. Experts say the agriculture-reliant Indian economy would continue to grow at a healthy rate in the quarters ahead as the country reaps the benefit of growing industrial output, buoyant tax revenues, and spiralling consumer spending. "The economy has expanded at a sharply higher rate in the July-September quarter than expected mainly on the back of a significant recovery in the agriculture production," said an economist with a credit rating firm here. "I think this will only get accelerated in the quarters ahead with the growing strength of the industrial sector and signs of a recovery in the global economy," the economist added. The Confederation of Indian Industry (CII) predicted that the growth in the October-December quarter could touch nine percent as a result of sharply higher agriculture output. "The second quarter (July-September) does not include the impact of the excellent monsoons of 2003," said a CII statement. "The third quarter (October-December) results will reflect some of the benefits of the monsoons and should, therefore, reach nine percent," it said, adding the time has now come to "raise the bar and go for 10 percent growth." According to official figures, the robust economic growth in the July-September quarter was led by the agriculture sector that expanded by 7.4 percent on good monsoon rains after falling 3.5 percent in the same period last year. More than five decades after the country's independence and all-round technological leaps, the weather god is still the chief provider for the economy of India, where agriculture remains the mainstay for millions. The quantity of rainfall in the June-September period is crucial for the farm sector that accounts for nearly a quarter of the gross domestic product and employs 70 percent of the country's over one billion population. India's economy grew by a moderate 4.3 percent in the fiscal year ended March 31, 2003, mainly due to a 3.1 percent fall in agriculture produce, as the worst drought in three decades ravaged large parts of the country. Enthused by the better-than-expected monsoon rains, the Indian government as well as leading think tanks have projected a over seven percent growth in the current fiscal year. A seven percent growth will be the strongest full-year expansion after six years. The last time India's economy grew over seven percent was in 1996-97, when it touched 7.8 percent. In the quarter ended September of the fiscal year 2003-04, manufacturing sector post a growth of 7.3 percent up from 6.5 percent in the same period last year, while services rose a robust 9.6 percent as compared to 7.8 percent. Besides, financing, insurance, real estate, business services, community, social and personal services also contributed to the overall cracking economic growth during the July-September quarter.
Source: IANS
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