India's Q2 GDP likely grew 4.5 per cent, say experts

After a sluggish first quarter, India's economy may have expanded by about 4.5 per cent in the quarter ended September, 2013 on the back of rising exports and a good monsoon helping industrial recovery, according to experts.

The second-quarter GDP numbers are slated to be announced on Friday, November 29.

"GDP growth would have improved to 4.6 per cent in Q2 from 4.4 per cent in Q1, with a pick-up in the performance of industry at around 2.3 per cent from 0.2 per cent and agriculture at near 3.5 per cent from 2.7 per cent, which could have offset the slowdown in the services sector," ICRA Ltd said in a report.

ICRA, an associate of Moody's Investors Service, said the Index of Industrial Production (IIP) indicates a mild improvement in manufacturing and mining, and quarrying, in Q2 from the previous quarter.

"While investment activity remained muted and consumption confidence weakened, the performance of merchandise exports improved considerably in Q2 relative to Q1," it said.

As per FICCI's latest Economic Outlook Survey, the GDP grew 4.5 per cent in the second quarter.

Dun & Bradstreet said economic expansion in India is expected at about 4.5 per cent during the quarter and it is further likely to remain weak during the remaining fiscal year (FY14).

Deutsche Bank was more optimistic and said the economy is likely to have grown 5.5 per cent in Q2 on the good monsoon, higher industrial growth and an increase in public spending.

"While expectations remain poor, we estimate that real GDP rose by 5.5 per cent during the quarter, the best performance in a year," the bank said in a note.

India's economic growth hit a decade low of 5 per cent in 2012-13 on account of poor performances in the farm, manufacturing and mining sectors.

The Reserve Bank of India (RBI) expects GDP to expand 5 per cent in the current financial year, while the government estimates a 5-5.5 per cent growth.

Both the International Monetary Fund and the World Bank have lowered their growth forecasts for India in 2013-14. The IMF projected an average growth rate of about 3.75 per cent at market prices, while the World Bank slashed its growth forecast to 4.7 per cent from a projection of 6.1 per cent earlier.