India: Economy continues to lose steam
August 30, 2011
The economy is showing signs of a gradual deceleration, expanding at the slowest pace in three quarters. In the April-June period ? the first quarter of the fiscal year 2011/12 ? GDP increased 7.7% over the same period last year. The reading came in a notch below the 7.8% expansion observed in the previous quarter but was in line with last month's FocusEconomics Consensus Forecast panellists' expectations. The weakening over the previous quarter was mainly due to a slower growth pace in agriculture, which moderated to a 3.9% increase (Q4 2010/11: +7.5% year-on-year), as well in the construction sector, which grew just 1.2% (Q4 2010/11: +8.2% yoy). In contrast, growth in manufacturing picked up to 7.2% (Q4 2010/11: +5.5% yoy), while in the trade, hotels, transport and communication sector ? which represents nearly a quarter of the overall economy ? growth soared to a robust 12.8% (Q4 2010/11: +9.3% yoy).