Q1 macro numbers from CSO

The Indian economy expanded 4.4 per cent during the first quarter of the ongoing fiscal, continuing the slide from 5.4 per cent in Q1 to 5.2 per cent in Q2, and 4.7-4.8 per cent in Q3 & Q4 of the previous fiscal. In fact, the rate is the lowest since the fourth quarter of fiscal 2009, when the economy had gone under due to the global meltdown.

Project investment and private final consumption expenditure both declined during the quarter. The economic feat, which largely mirrors domestic travails, has led to a further round of pruning of growth projections for the country ranging between 3.7-4.2 per cent for the year. Also, the current run on Indian rupee which saw its value plummeting 20 per cent over May-August reflected the dismal economic performance and market perceptions about the near-term prospects.

GDP AT 2004-05 PRICES IN Q1

` billion
% Increase
 
2012-13
2013-14
2012-13
2013-14
Agriculture, Forestry & Fishing
1,769
1,817
2.9
2.7
Mining & Quarrying
263
256
0.4
-2.8
Manufacturing
2,012
1,988
-1
-1.2
Electricity, Gas & Water Supply
260
270
6.2
3.7
Construction
1,053
1,083
7
2.8
Trade, Hotels, Transport & Communication
3,702
3,846
6.1
3.9
Financing, Insurance, Real Estate & Business Services
2,510
2,734
9.3
8.9
Community, Social & Personal Services
1,573
1,721
8.9
9.4
GDP at Factor Cost
13,143
13,714
5.4
4.4
By Major Sectors
Agriculture, Forestry & Fishing
1,769
1,817
2.9
2.7
Industry
3,589
3,596
1.8
0.2
Services
7,785
8,301
7.7
6.6

Pervasive decline
In what makes the performance more worrisome, barring community and personal services which include government expenditure that bettered the year-ago quarterly rate of 8.9 per cent (which by the way reflected fiscal profligacy more), all other sectors constituting over four-fifth of the domestic economy grew less.

Worse, leaving aside financing and insurance, whose growth rate even when easing from the year-ago rate worked out above aggregate economy rate, the other sectors comprising farm, industry and trade, and hotels and transport pulled down the total economic feat. Trade, hotels and transport clearly bore the effect of retarding farm and industry: the growth rate in the sector dropped to 3.9 per cent, from 6.1 per cent in this quarter a year ago. The pace is the second lowest since 2004-05, surpassing 1 per cent in the global meltdown-crippled last quarter of fiscal 2009.

Assuming continuation of recent years’ trend, transport was probably very badly hit because of truncated volumes of food grain and manufactured goods. Reflecting Rabi crop, the growth rate in farming income declined from 2.9 per cent to 2.7 per cent, whereas manufacturing and mining reduced during the quarter, over a dismal feat in this quarter a year ago. Power generation decelerated to 3.7 per cent (6.2 per cent).

ECONOMY PERFORMANCE (Y-O-Y % GROWTH)
 
Construction
GFCF
Manufacturing
GDP
2010-11
10.2
14.0
9.7
9.3
Q1
10.6
15.2
11.3
8.6
Q2
8.2
13.5
8.2
9.2
Q3
10.9
18.0
10.0
9.9
Q4
11.1
9.9
9.5
9.2
2011-12
5.6
4.4
2.7
6.2
Q1
3.8
13.9
7.4
7.5
Q2
6.5
3.8
3.1
6.5
Q3
6.9
-1.7
0.7
6.0
Q4
5.1
2.6
0.1
5.1
2012-13
4.3
1.7
1.0
5.0
Q1
7.0
-2.2
-1.0
5.4
Q2
3.1
1.1
0.1
5.2
Q3
2.9
4.5
2.5
4.7
Q4
4.4
3.4
2.6
4.8
2013-14
Q1
2.8
-1.2
-1.2
4.4

Project investment
Gross fixed capital formation (investment) declined over the quarter, dashing further any hopes of a revival in investment raised by 4.5 per cent expansion in the third quarter of the preceding fiscal, following a spurt in reforms and the ensuing optimism on investment front. The fourth quarter had seen the expansion rate fall to 3.4 per cent and the first quarter ended with a 1.2 per cent annual decline. Capital goods production index declined 3.3 per cent during Q1. The growth rate in construction income dropped to 2.8 per cent from 7 per cent in this quarter in fiscal 2013.

Production of cement and consumption of finished steel registered growth rates of 3.3 per cent and 0.2 per cent respectively during the quarter.
Private final consumption expenditure grew only 1.6 per cent over the quarter, a new low in recent years and reflected continuation of the rot of previous four quarters. Government final consumption expenditure quickened the pace to 10.5 per cent (7.2 per cent). Investment in valuables, a volatile indicator, showed 92 per cent shoot up over the quarter, against 21 per cent drop in this quarter a year ago.


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