GDP growth in Q1 indicates turnaround - FICCI

31 Aug '09

2 min read

Reacting to the latest quarterly GDP estimate, Mr. Harsh Pati Singhania, President, FICCI said “This growth on a sequential basis from 5.8% in the fourth quarter of 2008-09 to 6.1% in the first quarter in 2009-10 is an indication of a turnaround in the economy”.

“Several key segments of the economy such as mining and quarrying, electricity, gas and water supply and financing, insurance and real estate have recorded higher growth on year on year basis. With global recession bottoming out we expect other sectors such as trade, hotels, transport and communication and manufacturing to accelerate their pace of growth in the coming months and contribute to overall GDP”, he added.

“While the performance of the agriculture sector has been a little disappointing, we are still hopeful of achieving an overall growth of 6.5% in the year 2009-10. The stimulus measures taken by the government are yielding results on the ground and there is a clear case for continuing with these for some more time”, said Mr. Singhania.

The first quarter GDP numbers show picking up of the pace of economic activity over a wide range of sectors compared to last year. They also highlight that despite weak performance of the agriculture sector, the economy is showing a turnaround.

FICCI is hopeful that the manufacturing sector would gather pace as the year progresses. Further, segments like trade, hotels, transport and communication should also gain momentum as recession eases in different parts of the world.

On the whole, despite the drought and a decline in agriculture sector performance, FICCI is hopeful that the economy would clock a growth of 6.5% plus in the current financial year. FICCI supports the need for continuing with stimulus measures for some more time as phasing of these growth triggers can once again affect wide segments of the economy.

FICCI

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