GDP Data Closer To Ground Reality, Say Experts As Economy Grows At 6.1% In March Quarter

Mumbai: India's economy grew 6.1 per cent in the three months through March from a year earlier, slowing from a provisional 7.0 per cent in the previous quarter, government data showed on Wednesday. That was much lower than the forecasts for annual growth of 7.1 per cent in the January-March quarter reflected in a Reuters poll. Growth for the year ending in March came in at 7.1 per cent, in line with the official estimate.

COMMENTS

Anjali Verma, economist, Phillipcapital India, Mumbai:

"It looks pretty tepid. GVA (gross value added) at 5.6 per cent is weak, except for public administration and some bit on agriculture."

"Everything else is very, very weak. Manufacturing is pretty tepid, construction continues to remain very weak despite all the things the government has been saying. It's not looking good. The numbers are not at all good."

"This data is closer to the ground reality than the previous ones."

"Going ahead, I think one key factor will be the banking sector. That's dragging growth substantially. I am surprised why there is still no growth coming in construction, but I think with housing impetus it should happen gradually."

Gaurav Dua, head of research, Sharekhan:

"The current GDP rate is much closer to ground reality, and it is likely to soften the Reserve Bank's hawkish stance on growth. Hence, I do not expect a rate hike by the RBI anytime soon. Neither do I see a rate cut in the next few months."

"The implementation of GST (goods and services tax) could have a short-term impact, which will reflect on the overall full-year GDP growth, but that is because of the rollout of GST and not because of the tax slabs."

Varun Khandelwal, managing director, Bullero Capital:

"Q4 GDP number was a bit disappointing."

"Since listed companies have reported a slowdown in their earnings for Q3 and Q4, I expect the data to be revised downwards."

"The most significant imbalance in India's growth story is the paucity of job creation. The demographic 'dividend' is slowly turning into a 'tax' as more young people enter the workforce, while the pace of job creation is meagre."

"It is critical that policy makers focus on a more equitable distribution of growth for the long-term socio-political stability of the country."