Confirming fears of a slowdown, India's economy grew by just 7.7% in the first quarter of the 2011-12 financial year, compared to 8.8% growth in the same three-month period last fiscal, which was mainly due to the poor performance of the manufacturing sector.
The government has projected overall economic growth in the current fiscal at around 8.5%, while the Reserve Bank has projected the growth to moderate to 8% from 8.5% in FY'11.
In the latest data released by the government today, GDP growth for the April-June quarter of the 2010-11 fiscal has also been revised downward to 8.8% from the earlier provisional estimate of 9.3%.
During the quarter ending June 30, 2011, growth in the manufacturing sector dipped to 7.2% from 10.6% in the corresponding period of 2010-11.
In addition, the mining and quarrying sector grew by just 1.8% during the quarter under review, as against 7.4% growth in the first quarter of the previous fiscal.
However, farm output showed an improvement, expanding by 3.9% during the quarter under review, compared to 2.4% in the corresponding three-month period last fiscal.
Furthermore, the trade, hotels, transport and communications segments grew by 12.8% in the quarter under review, up from 12.1% in the year-ago period.
The services sector, including insurance and real estate, grew by 9.1% in the June quarter this year, compared to 9.8% expansion in the corresponding period last year.
The Planning Commission has estimated GDP growth at 8-8.3% in the 2011-12 financial year. The Indian economy expanded by 8.5% in the 2010-11 fiscal.
