India’s gross domestic product grew at 7.8% in the financial quarter ending March 2024, according to data released by the Centre on Friday.
This was slower than the 8.4% growth recorded in the quarter ending December 2023, when the Indian economy grew at its fastest pace since the second quarter of 2022. However, the economy grew faster than predicted by analysts.
A survey of economists by Moneycontrol had estimated the gross domestic product to slow down to around 6.5% to 6.7% in the last quarter of the financial year 2023-’24.
The Centre also revised gross domestic product growth for the financial year 2023-’24 to 8.2%, up from the second advance estimate of 7.6% that was released on February 29.
India’s economic output was able to surpass industry estimates largely due to the performance of the manufacturing sector, which grew at 9.9% in 2023'-’24 after slowing down by 2.2% in the financial year 2022-’23, reported Mint. The mining sector, which grew at 7.1% in 2023-’24 over 1.9% in 2022-’23, also contributed.
Finance minister Nirmala Sitharaman said on Friday: “Today’s GDP data showcases robust economic growth with a growth rate of 8.2% for FY 2023-24 and 7.8% for Q4 of FY 2023-24. This remarkable GDP growth rate is the highest among the major economies of the world.”
The Centre’s fiscal deficit for 2023-’24 stood at 5.63% of the gross domestic product, marginally better than the Union Budget estimate of 5.8% , according to data released on Friday.
In recent months, several economists have questioned whether the country’s gross domestic product figures were inflated.
In March, former Chief Economic Advisor Arvind Subramanian had described India’s economic growth in the quarter ending December 2023 as “mystifying”, saying that the implied inflation in the Centre’s numbers was 1% to 1.5%, while actual inflation was between 3% and 5%.
“The economy is growing at 7.5% even though private consumption is at 3%,” he had said. “There is a lot of stuff about the numbers which you know, I don't understand. I am not saying these are wrong. That’s for others to judge.”
Last month, former Reserve Bank of India Governor Raghuram Rajan said that if India were to “take away the fluff” from its gross domestic product numbers, the real growth rate would be around 6%.
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