India’s economic growth slowed to a seven-year low of 5 percent in the April-June quarter of FY 2019-20 from 8 percent in the previous year, according to government data released Friday, 30 August.
The downward spiral in the manufacturing sector and slow agriculture output were responsible for the slowdown, the Ministry of Statistics and Programme Implementation said in a statement.
The previous low stood at 4.9 percent in the April-June quarter of FY 2012-13.
This year, the manufacturing sector grew by 0.6 percent as opposed to 12.1 percent in Q1 2018-19. While agriculture, forestry and fishing sectors grew by 2 percent as compared to 5.1 percent in the first quarter of the last fiscal year.
Accordingly, the Reserve Bank had marginally lowered the GDP growth projection for 2019-20 to 6.9 percent from 7 percent projected earlier in the June policy. It also highlighted the need for boosting aggregate demand.
The present economic slowdown has kept corporates worried with companies reporting a sharp downfall in both revenue and profit in the June quarter.
Meanwhile, the passenger vehicle industry was hit with the worst low in 19 years. A sharp decline in demand was what followed.
Looking beyond India, China’s economic growth was 6.2 percent in the April-June quarter of 2019, the weakest growth in 27 years.