Indian Economy Recorded 8.9 per cent Growth in Second Quarter

According to the Central Statistical Organisation (CSO) data released on 30 November 2010, Indian economy grew 8.9 per cent in the second quarter of the current fiscal 2010-11. The corresponding period of 2009 had seen growth of 8.7%. The robust growth recorded in the July-September quarter is attributed to farm sector which in the second quarter recorded a growth rate of 4.4 per cent, up from 0.9 per cent in the corresponding period in 2009. The manufacturing sector during the same period recorded a growth rate of 9.8 per cent as compared to 8.4 per cent during the same period in 2009.

However the second quarter growth is lower than China’s expansion of 9.6% though the pace of growth is much faster than the US (1.9%) and the Eurozone (2.5%). According to economists growth moderation is possible in the remaining two quarters and as a result pressure on Reserve Bank of India (RBI) to increase interest rates further will ease as inflation continues to remain high.