Aided by a bump up in agricultural growth, the economy grew at a higher-than-expected 7.3 per cent in the second quarter. This is higher than the 7.1 per cent growth recorded in the previous quarter.
The latest second-quarter GDP growth was, however, much lower than the 7.6 per cent growth in the same quarter last fiscal.
Agricultural output growth came in at 3.3 per cent for the quarter under review against 2 per cent in the same quarter last fiscal. The first quarter had seen a agricultural growth of 1.8 per cent.
Manufacturing growth slowed to 7.1 per cent against 9.1 per cent in the first quarter, mining was down 1.5 per cent against a 0.4 per cent fall in the first quarter. Construction was up 3.5 per cent (1.5 per cent).
In services, the ‘trade, hotels, transport and communication’ group was up 7.1 per cent, while financing rose 8.2 per cent. Public administration and defence was up 12.5 per cent.
Today’s GDP numbers do not reflect the effect of the Modi-led government’s sudden demonetisation move of November 8. The impact of demonetisation is widely expected to hit economic growth in the third quarter. The decline in economic activity is expected to lower corporate sales volumes and cash flows, according to experts.
Moody’s Investors Services said the recent demonetisation move would weigh on GDP growth for a few quarters, dampening government revenues.
Fiscal deficit The Centre's fiscal deficit for the April-October period came in at ₹4.2 lakh crore against ₹4.1 lakh in the same period last year. This reflects 79.3 per cent of the annual target of ₹5.34 lakh crore.
Revenue deficit for the period stood at ₹3.28 lakh crore (₹2.87 lakh crore in the same period last year).