GDP Data, Growth, Performance, and Important Parameters for Q2 of FY25 Highlights of the news: For the quarter that ended in September 2024, GDP growth slowed to 5.4%. In the April-June quarter (Q1), India's GDP grew 6.7%, which was the worst growth rate in five quarters. Additionally, during the general elections, the administration cut back on spending. Nonetheless, the administration claimed that the growth momentum is robust and that a full fiscal year growth estimate of 6.5–7% is reasonable.
Highlights of India's Q2 GDP Growth Data 2024 and Q2 FY25 GDP News: Get up-to-date, real-time news on India's GDP growth in the second quarter of the 2024–25 fiscal year, including when the data will be released.Real-time GDP updates: CEA Chief Economic Advisor V Anantha Nageswaran said Friday that while the economic growth figure of 5.4% for the July-September quarter was "disappointing," the situation is "not alarming." He also said that the 6.5% GDP target for FY25 is "not in danger."
Along with highlighting industries demonstrating resilience, he also enumerated the main causes of the slowdown.
Mr. Rahul Agrawal, Senior Economist at ICRA Limited, provides commentary on the real-time GDP updates.
Mr. Rahul Agrawal, ICRA Limited's Senior Economist.
Despite a negative base, the core sector's year-over-year (YoY) growth slowed to 3.1% in October 2024 from 2.4% the month before. The constituent industries' performance varied; four reported that their growth had improved between these months, while an equal number reported that their growth had slowed.
Even though the rise in energy generation in October 2024 was slightly better than in September 2024, it was still only 1%, which continued to have an impact on the growth in production from the core sector during the month. The statistics pertaining to construction showed conflicting patterns, with the rise in cement output declining and the growth in steel production improving.
GDP Real-Time Updates: Growth Rate Declines to 5.4% in July–September 2024
According to government figures, economic growth slowed to 5.4 percent in the July–September 2024 quarter from 8.1 percent in the previous quarter.
Live GDP Q2 updates: The debt-to-GDP ratio has increased dramatically
Up until 2018, India's aggregate debt-to-GDP ratio was around 69 percent; in 2024, it stands at 83.1%.
Live Q2 GDP updates: Both the federal government and the states must have a clear action plan to address debt
With the Finance Minister vowing to lower the debt-to-GDP ratio in the upcoming years, it is commendable that the Center is now concentrating on debt reduction. However, this is only possible if a well-defined plan of action is created and strictly followed to address the debt by both the Centre as well as the State governments.
According to government figures, economic growth slowed to 5.4 percent in the July–September 2024 quarter from 8.1 percent in the previous quarter.
Live GDP Q2 updates: The debt-to-GDP ratio has increased dramatically
Up until 2018, India's aggregate debt-to-GDP ratio was around 69 percent; in 2024, it stands at 83.1%.
Live Q2 GDP updates: Both the federal government and the states must have a clear action plan to address debt
With the Finance Minister vowing to lower the debt-to-GDP ratio in the upcoming years, it is commendable that the Center is now concentrating on debt reduction. However, this is only possible if a well-defined plan of action is created and strictly followed to address the debt by both the Centre as well as the State governments.
Real-time GDP second-quarter updates: Having a lot of debt always has terrible consequences.
High debt has a number of detrimental effects, such as increased borrowing costs for the economy, currency market volatility brought on by capital flight, and elevated inflation expectations. Government expenditure on other areas may eventually decline due to the rising interest load and repayment commitments, which will have an effect on growth.
Real-time GDP second-quarter updates: Time to address the growing debt
The Center and States must work together to improve India's debt-to-GDP ratio, which is higher than the global and EM average. Read the entire study for more information.
Live updates on GDP for the second quarter: India Ratings predicts that the fiscal deficit will be less than budgeted amounts.
India Ratings predicts a 19 basis point reduction in the fiscal deficit compared to budget expectations.
India Ratings & Research (Ind-Ra) stated on Wednesday that the center's fiscal deficit, or the difference between income and expenses, is probably going to be 19 basis points (bps, 100 bps, or 1 percentage point) less than the budget predictions for the current fiscal year, or Fiscal Year 2024–2025.
In July of this year, when he presented the full budget, Finance Minister Nirmala Sitharaman estimated the deficit to be 4.9% of GDP. Additionally, she stated: "Our economy has benefited much from the fiscal consolidation plan I proposed in 2021, and we intend to reach a deficit below 4.5 per cent next year.”
High debt has a number of detrimental effects, such as increased borrowing costs for the economy, currency market volatility brought on by capital flight, and elevated inflation expectations. Government expenditure on other areas may eventually decline due to the rising interest load and repayment commitments, which will have an effect on growth.
Real-time GDP second-quarter updates: Time to address the growing debt
The Center and States must work together to improve India's debt-to-GDP ratio, which is higher than the global and EM average. Read the entire study for more information.
Live updates on GDP for the second quarter: India Ratings predicts that the fiscal deficit will be less than budgeted amounts.
India Ratings predicts a 19 basis point reduction in the fiscal deficit compared to budget expectations.
India Ratings & Research (Ind-Ra) stated on Wednesday that the center's fiscal deficit, or the difference between income and expenses, is probably going to be 19 basis points (bps, 100 bps, or 1 percentage point) less than the budget predictions for the current fiscal year, or Fiscal Year 2024–2025.
In July of this year, when he presented the full budget, Finance Minister Nirmala Sitharaman estimated the deficit to be 4.9% of GDP. Additionally, she stated: "Our economy has benefited much from the fiscal consolidation plan I proposed in 2021, and we intend to reach a deficit below 4.5 per cent next year.”
Live second-quarter GDP updates: EY India claims that the decline in capital expenditures caused growth to stall in the first quarter and calls for a monetary and fiscal policy dance
One of the primary causes of the slowdown, according to DK Srivastava, Chief Policy Advisor at EY India, was the Government of India's capital spending contraction, which fell by (-)15.4% between April and September. He emphasized that at this point, monetary and fiscal policy measures are required. While monetary policy action may be postponed past December 2024, "fiscal policy action in the form of accelerated government investment expenditure should be given the highest priority." India might eventually follow the US Fed's lead in lowering its policy rates, he said.
Updates on GDP Live for the second quarter of FY25: Rainfall may have had an impact on retail foot traffic, power demand, and mining activity.
According to Aditi Nayar, Chief Economist and Head of Research & Outreach at ICRA, Q2 showed positive developments in the sowing of main kharif crops and a recovery in capital expenditures following the parliamentary elections. Heavy rainfall, however, created challenges for a number of industries, including mining, electricity consumption, retail foot traffic, and item exports. Furthermore, corporate margins across a range of industries seem to have declined this quarter. Consequently, she stated, "we project a slight dip in India's GVA and GDP growth in Q2 FY2025 to 6.6 per cent and 6.5 per cent, respectively."
Updates on GDP Live for the second quarter of FY25: ICRA says the slowdown is probably due to heavy rains and weak margins, which counteract the impact of higher government capital expenditures and more kharif sowing.
One of the primary causes of the slowdown, according to DK Srivastava, Chief Policy Advisor at EY India, was the Government of India's capital spending contraction, which fell by (-)15.4% between April and September. He emphasized that at this point, monetary and fiscal policy measures are required. While monetary policy action may be postponed past December 2024, "fiscal policy action in the form of accelerated government investment expenditure should be given the highest priority." India might eventually follow the US Fed's lead in lowering its policy rates, he said.
Updates on GDP Live for the second quarter of FY25: Rainfall may have had an impact on retail foot traffic, power demand, and mining activity.
According to Aditi Nayar, Chief Economist and Head of Research & Outreach at ICRA, Q2 showed positive developments in the sowing of main kharif crops and a recovery in capital expenditures following the parliamentary elections. Heavy rainfall, however, created challenges for a number of industries, including mining, electricity consumption, retail foot traffic, and item exports. Furthermore, corporate margins across a range of industries seem to have declined this quarter. Consequently, she stated, "we project a slight dip in India's GVA and GDP growth in Q2 FY2025 to 6.6 per cent and 6.5 per cent, respectively."
Updates on GDP Live for the second quarter of FY25: ICRA says the slowdown is probably due to heavy rains and weak margins, which counteract the impact of higher government capital expenditures and more kharif sowing.
ICRA predicted in its analysis earlier this week that growth would decline as a result of heavy rains and weak margins, offsetting the positive momentum brought about by the government's capital expenditure reversal and the positive trends in kharif sowing. Additionally, the industrial sector is expected to drive growth in gross value added (GVA) to +5.5 percent from +8.3 percent in Q2 of FY2025, while services expansion is expected to pick up speed to +7.8 percent from +7.2 percent and agricultural GVA to +3.5 percent from Q1 of FY2025.
GDP updates for the second quarter Live: Research agencies warn that growth could slow to 6.5%.
According to research agencies, the current fiscal year's July-September quarter (Q2) probably saw a slowdown in growth. GDP growth was predicted by ICRA to drop to 6.5% in Q2 from 6.7% in the April–June period. While CareEdge seems a little more upbeat, predicting growth in the range of 6.6% to 6.8%, an earlier SBI research report also projected growth at 6.5%. According to the RBI's October bulletin, growth would be 6.8%.
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