India: Economic growth picks up in Q1 2014/15
August 29, 2014
GDP increased 5.7% over the same period last year in the April-June period (the first quarter of fiscal year 2014/2015). The reading marked a notable improvement over the 4.6% expansion registered in the fourth quarter of fiscal year 2013/14 and marked the fastest pace of growth in more than two years. In addition, the expansion overshot the 5.5% increase the markets had expected.
The quarterly reading reflected that the all-important manufacturing sector bounced back from a 1.4% contraction in Q4 2013/14 to a 3.5% expansion in Q1 2014/2015. In addition, the mining sector swung from a 0.5% decrease in the January-March to a 2.1% expansion in the three-month period to June. Moreover, electricity, gas and water production as well as construction showed notable improvements in Q1 2014/15, increasing 10.2% and 4.8%, respectively. Growth in financial services maintained a healthy performance, rising 10.4% in Q1 2014/15 (Q4 2013/14: +12.4% yoy). Meanwhile, agriculture slowed from a 6.3% expansion in Q4 2013/2014 to a 3.8% increase in Q1 2014/2015.
Author: Ricardo Aceves, Senior Economist