Indian GDP grows 6.3% in Q2; manufacturing slips due to low SME growth

New Delhi, Dec 1 (KNN) In the second quarter of the current fiscal, the Indian economy grew by 6.3 per cent and the manufacturing sector saw a negative growth due to low growth for the SME sector as per index of industrial production (IIP) numbers.

According to the data released by the National Statistical Office (NSO), the gross domestic product (GDP) had expanded by 8.4 per cent in the July-September quarter of 2021-22.

Recorded in the April-June quarter this fiscal, analysts had projected the Indian economy would expand at half of the growth rate of 13.5 per cent.

Rating agency ICRA said the GDP was likely to grow at 6.5 per cent while State Bank of India projected the growth rate at 5.8 per cent in the September 2022 quarter.

“While most numbers were on expected lines, manufacturing has been a disappointment with a negative growth rate. In case of manufacturing it has been clearly affected by low growth for the small and medium enterprises (SME) sector as per index of industrial production (IIP) numbers, and fall in profits that has affected value added for the organized sector,” said Madan Sabnavis, chief economist of Bank of Baroda.

On Monday, rating agency Standard & Poor’s said that it now expects India’s GDP to grow at 7 per cent for FY23 as compared to the 7.3 per cent it had estimated earlier.

CRISIL estimates mirror S&P’s – as it lowered from 7.3 per cent to 7 per cent – but over a week ahead of S&P. CRISIL also expects FY24 growth to slow down further to 6 per cent.  (KNN Bureau)