Yemisi Izuora
Better agriculture sector and financial industry performances have been cited as boosting India’s economy which registered 7.8 per cent growth in the first quarter of the current financial year (April-June).
Official data on Thursday said both sectors accounted mostly for the feat.
The World Bank says India is one of the fastest-growing economies of the world and is poised to continue on this path.
India’s agriculture sector recorded growth of 3.5 per cent in three months, up from 2.4 per cent in the April-June quarter last year, according to the data released by the government-run National Statistical Office.
The rise in financial, real estate and professional services was 12.2 per cent, up from 8.5 per cent in April-June last year.
However, the manufacturing sector growth decelerated to 4.7 per cent in the first quarter of the current fiscal year, compared to 6.1 per cent a year ago, the data suggests. India’s financial year runs from April to March.
The output in mining, electricity, gas, water supply and construction also slowed in the April-June quarter.
However, the World Bank said the persisting headwinds – rising borrowing costs, tightening financial conditions and ongoing inflationary pressures – are expected to weigh on India’s growth this year.
Indian media reports said the erratic monsoon, caused by the El Niño effect warming the eastern Pacific Ocean, is likely to moderate growth in the remaining three quarters of the year.
Real gross domestic product growth is likely to moderate to 6.3 per cent in the current financial year from an estimated 6.9 per cent in the last financial year, the World Bank said.
India’s federal bank expects the country’s yearly growth rate at 6.5 per cent.