India's July-Sept GDP growth seen at 5.4 percent

BANGALORE Wed Nov 28, 2012 9:21am IST

1 of 2. A worker works next to the assembly line of the Hyundai Motor India Ltd. plant at Kancheepuram district in Tamil Nadu October 4, 2012.

Credit: Reuters/Babu

Related Topics

Priyanka Gandhi Vadra, daughter of Congress party chief Sonia Gandhi, adjusts her flower garlands as she campaigns for her mother during an election meeting at Rae Bareli in Uttar Pradesh April 22, 2014. REUTERS/Pawan Kumar

Election 2014

More than 814 million people — a number larger than the population of Europe — are eligible to vote in the world’s biggest democratic exercise.  Full Coverage 

BANGALORE (Reuters) - India's economy probably expanded near its slowest pace in three years in the quarter to September, according to a Reuters poll, suggesting little signs of an early turnaround, despite reform steps taken by the government to lure back investors.

Gross domestic product rose 5.4 percent year-on-year in the July-September period, slightly lower than the 5.5 percent increase in the previous quarter, and only just above the three-year low of 5.3 percent in the quarter to end-March, the median consensus of 39 consensus showed.

Forecasts ranged from 5.0 percent to 6.2 percent.

Asia's third-largest economy is growing faster than many other countries, but the pace is way below the 9 percent growth that the government has targeted to provide jobs for a booming young population.

Data on factory activity showed slowing global demand hurt exports and falling investments weighed on the manufacturing sector, which has been the biggest drag on overall growth in the quarter to September.

"There have been no signs of an upturn in India," said Andrew Kenningham, chief economist at Capital Economics.

"Available data on industrial production and the PMIs point to little change in growth, while exports have been even weaker in the quarter to September. Overall, therefore, a small further decline in growth rate is most likely."

The government has launched a slew of initiatives to boost growth, including raising subsidised diesel prices and opening sectors like supermarkets to foreign players.

However, it has since struggled to enforce the reforms and failed to break a deadlock in parliament over opening up the retail sector.

"The relaxation of restrictions on inward investment will have no impact this year, and probably minimal impact in 2013," said Kenningham.

The central bank has so far rebuffed calls for interest rate cuts, saying prices are still rising too fast to risk loosening policy much, and it also wants the government to bring down a worryingly high fiscal deficit.

The next monetary policy review is due in December.

(Polling and analysis by Shaloo Srivastava; Editing by Sanjeev Miglani)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Election 2014

Election 2014

Kashmiris wary as Modi challenges for power.  Full Article 

Facebook's Performance

Facebook's Performance

Facebook Q1 revenue grows 72 percent on rising mobile ads.  Full Article 

Earnings Season

Earnings Season

Bharti Infratel Q4 net profit jumps 64 percent.  Full Article 

Monsoon Forecast

Monsoon Forecast

South Asia monsoon seen below-average to average in 2014 - WMO.  Full Article 

Solar Dispute

Solar Dispute

Green groups urge U.S. to drop solar trade case against India.  Full Article 

Oil Imports

Oil Imports

India to make May-July oil payments to Iran - sources.  Full Article 

Rice Exports

Rice Exports

India may cede top rice exporter spot under Southeast Asian price onslaught.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage