India’s GDP growth slows to 5.4% in Q2, below RBI estimate: Govt data

The economy expanded 5.4% in the second quarter from a year ago, hobbled by tepid consumption demand and a weakening in the mining sector

NEW DELHI: India’s growth of gross domestic product (GDP) slowed to a seven-quarter low during July-September quarter of 2024-25, data released by the ministry of statistics and programme implementation showed.

India remains the fastest-growing major economy as China’s GDP growth in the July-September quarter this year was 4.6%. (REUTERS FILE PHOTO)

The economy expanded 5.4% in the quarter ending September 2024 from a year ago, hobbled by tepid consumption demand and a weakening in the mining sector, the data showed. In the previous (first) quarter of 2024-25, GDP grew 6.8%.

Expansion of gross value added, a measure of growth that excludes indirect tax and subsidies, is estimated to be 5.6%, compared to 6.8% in the preceding quarter.

The second-quarter growth is way slower than the Reserve Bank of India’s estimate of 7%.

“These estimates are provisional but the government will look into causes of slower growth in manufacturing and a contraction in mining and the reasons behind agriculture doing well, which was helped by a good monsoon,” an official said, requesting anonymity.

Among key sectors, agriculture posted a reasonably decent growth of 3.5% in the second quarter. Mining growth shrunk 0.1%, compared to 11.1% a year ago. Manufacturing expanded 2.2% against 14.3% a year ago while construction, the largest provider of informal jobs, grew 7.7% as compared with 13.6% a year earlier.

“While we are not revising our full-year growth projection, we will closely monitor the momentum going forward,” said Sujan Hajra, Anand Rathi Shares.