The Indian economy grew 7.4 percent in the second quarter ended September, showing some improvement over the 7 percent expansion in the quarter before but a notch lower than the 8.4 percent registered in the same quarter of the last fiscal.
As per official data on gross domestic product (GDP) released by the Central Statistics Office (CSO), under the statistics and programme implementation ministry, the growth was led mainly by expansion in commercial and financial services and manufacturing output.
GDP, which is the aggregate market value of all the goods and services produced in the country, had expanded by 8.4 percent in the corresponding quarter of last fiscal.
"GDP at constant (2011-12) prices in Q2 of 2015-16 is estimated at Rs.27.57 lakh crore, as against Rs.25.66 lakh crore in Q2 of 2014-15, showing a growth rate of 7.4 percent," a statement quoted the CSO as saying.
"Quarterly GVA (gross value added) at Basic Price at constant (2011-12) prices for Q2 of 2015-16 is estimated at Rs.25.80 lakh crore, as against Rs.24.02 lakh crore in Q2 of 2014-15, showing a growth rate of 7.4 percent over the corresponding quarter of previous year," it added.
The GVA, which is a gauge to measure the value of goods and services produced in a particular sector or a grouping of industries, had stood at 8.4 percent in the corresponding quarter of last fiscal.
According to the data released, economic activities which registered growth of over 7 percent in Q2 of 2015-16 over Q2 of 2014-15 are "trade, hotels and transport, communication and services related to broadcasting, financial, insurance, real estate and professional services and manufacturing".
During this period, the growth in agriculture, forestry and fishing was 2.2 percent, mining and quarrying grew 3.2 percent, electricity, gas, water supply and other utility services' growth was 6.7 percent, construction at 2.6 percent, and public administration, defence and other services grew 4.7 percent, CSO said.
Growth in the commercial services segment, which includes trade, hotel, transport, communication and services related to broadcasting, in the quarter under review was at 10.6 percent, compared to 8.9 percent in Q2 of the last fiscal.
The financial services sector which comprises of industries like financing, insurance, real estate and professional services grew by 9.7 percent, a fall from 13.5 percent in the corresponding quarter of 2014-15.
Manufacturing output rose by 9.3 percent, as compared to 8.4 percent in the first quarter of the last fiscal.
Farm sector growth was flat during the quarter in question at 2.2 percent, compared to 2.1 percent in the same quarter last year.
Commenting on the GDP numbers, the Federation of Indian Chambers of Commerce and Industry (FICCI) said the uptick in growth showed that the economy is on a recovery path.
"We need to maintain this momentum and move on to a higher growth trajectory, which calls for continuous reforms," said its secretary general A. Didar Singh, but cautioned that the global economy has been volatile and domestic demand is restrained.
CII director general Chandrajit Banerjee said: "GDP data showing growth of 7.4 percent in the second quarter of FY2016 indicates that the recovery has gained strength, as we had anticipated."
The PHD Chamber of Commerce and Industry called for more reforms in agriculture and construction sectors.
"The poor growth of construction sector must be looked into, as the sector is crucial to generate employment opportunities for skilled and unskilled workforce," said chamber president Mahesh Gupta.
"Reforms in the agriculture sector would be critical to strengthen the growth of the sector and to address the supply side bottlenecks."
Fitch Group firm India Ratings and Research echoed similar concern over construction industry.
"While agriculture continued to surprise positively, construction activities have nearly collapsed," said its chief economist Devendra Kumar Pant.
"Despite decline in inflation and monetary easing, decline in second quarter consumption growth from the first quarter is a puzzling," he said.
