India's economic growth rate slipped to 6.1% in the third quarter this fiscal, lowest in more than 2 years due to poor performance of the manufacturing, mining and farm sectors.
The Gross domestic product (GDP) growth the in third quarter (October-December) last fiscal was 8.3%, as per the latest data released by the government today.
GDP in April-December period also moderated to 6.9% from 8.1% in the first nine months of 2010-11.
During the quarter ending December 31, growth in the manufacturing sector dipped to a meagre 0.4% from 7.8% in the corresponding period of 2010-11.
Farm output also exhibited a similar trend and expanded by just 2.7% during the quarter, compared to 11% in the corresponding period last fiscal.
Mining and quarrying production contracted by 3.1% during the quarter under review, as against a growth of 6.1% in Q3 of last fiscal.
Growth in the construction sector also slowed to 7.2% during the quarter from 8.7% in the same period a year ago.
Furthermore, the trade, hotels, transport and communications segments grew by just 9.2% in the quarter under review, as against 9.8% expansion in the year-ago period.
However, electricity, gas and water supply grew by robust 9% in the October-December period, compared to 3.8% growth in the corresponding period last fiscal.
The growth of the services sector, including insurance and real estate, slowed to 9.9% in the third quarter ended December, compared to 11.2% expansion in Q3 of 2010-11.
The Central Statistical Organisation has pegged the GDP growth for 2011-12 at 6.9%, while the Prime Minister's Economic Advisory Council (PMEAC) expects that it would be 7.1%.
The Indian economy expanded by 8.4% in 2010-11.
As per the data released today, manufacturing growth in the 9-month period ending December, slowed to 3.4% as compared to 7.6% during the same period a year ago.
During April-December, output of mining and quarrying sector declined by 1.4% as against a positive growth of 6.7% in same period last fiscal.
Furthermore, the agriculture, forestry and fishing sector grew by just 3.2% in the nine month period, as against 6.8% expansion a year ago.
Growth of the construction sector stood at 4.2% during the 9-month period, compared to 7.7% in the same period last fiscal.
The slowdown in the manufacturing sector, coupled with decline in mining and quarrying, is likely to put pressure on the Reserve Bank of India to cut interest rate at its mid-quarter monetary policy review on March 15.
Finance Minister Pranab Mukherjee too, in his Budget for 2012-13, to be presented on March 16 in Lok Sabha, is expected to announce steps for arresting economic slowdown.
India Inc has been blaming RBI's tight monetary policy, which has increased the cost of borrowings, for hindering fresh investments and slowing down the industrial growth.
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