Economy: India’s GDP growth falls in Q2FY25 to 5.4%
Virendra Pandit
New Delhi: Although the Narendra Modi-led NDA government returned to power a third time in June, with a reduced majority, the uncertainty it sparked, as also the unusually hot weather, may have been among the factors that caused the fall in the GDP growth in the second quarter (July-September 2025) of the current fiscal 2024-25.
A sluggish manufacturing sector dragged the economic growth based on Gross Domestic Products (GDP) to 5.4 percent during the July-September quarter of the current fiscal year. It was 6.7 percent during the April-June quarter and 8.1 during the corresponding quarter of last fiscal, FY24.
Despite sluggish growth observed in manufacturing (2.2 percent) and mining and quarrying (-0.1 percent) in Q2FY25, real GVA in H1 (April-September) has recorded a growth rate of 6.2 percent. Nominal GVA witnessed a growth rate of 8.1 percent in Q2 of FY25 against a 9.3 percent growth rate in Q2FY24.
The real GVA (Gross-Value Added) growth fell from 7.7 percent in the first quarter to 5.6 percent in the second quarter of the previous financial year, according to the data released by the Union Statistics Ministry on Friday.
The agriculture and allied sector bounced back by registering a growth rate of 3.5 percent in Q2FY25 after sub-optimal growth rates ranging from 0.4 percent to 2 percent observed during the previous four quarters.
In the construction sector, sustained domestic consumption of finished steel has resulted in 7.7 percent and 9.1 percent growth rates, respectively, in Q2 and H1 of FY25. The tertiary sector has observed a growth rate of 7.1 percent in Q2FY25, as compared to the 6 percent in Q2 of the previous financial year.
In particular, trade, hotels, transport, communication, and services related to broadcasting have seen a growth rate of 6 percent in Q2FY25, up from 4.5 percent in Q2FY24.
Private Final Consumption Expenditure (PFCE) has witnessed a growth rate of 6 percent and 6.7 percent respectively in Q2 and H1 of the FY 25, an increase from the growth rate of 2.6 percent and 4 percent in Q2 and H1 of the previous financial year, the data revealed.
