India likely registered GDP growth rate in Q2 FY14 of 4.5 pct, says D&B

PTI Posted online: Friday, Nov 22, 2013 at 0000 hrs
New Delhi : The overall GDP growth in India is expected to have increased by around 4.5 per cent during the second quarter (Q2) of this financial year and is further likely to remain weak during the remaining fiscal, says a Dun & Bradstreet report.

According to the US-based research firm, the country's economic growth rate in the second quarter of this fiscal (July-September) period is likely to be around 4.5 per cent.

This is a tad higher than the economic growth registered in the April-June quarter of this fiscal (4.4 per cent).

The country's economic growth hit a decade low of 5 per cent in the last fiscal on account of poor performance in the farm, manufacturing and mining sectors.

"With almost three quarters of FY14 behind us, inflationary pressures remain unabated, manufacturing sector fails to revive, fiscal deficit continues to rise and the domestic private sector consumption continues to weaken," Dun and Bradstreet India Senior Economist Arun Singh said.

Singh further noted that "overall GDP is expected to have grown at around 4.5 per cent during Q2 FY14 and is further likely to remain weak during the remaining fiscal year."

Currently, the only support has been from easing of current account deficit (CAD) due to revival in export demand and the fast-tracking of tardy infrastructure projects by the Cabinet Committee on Investments.

However, the trickle down effects of the execution of these huge projects can be realised only after a few more months, Singh added.

Though the RBI and the government have taken number of measures to support growth, "given that election is around the corner, it remains to be seen how soon these measures help improve the business confidence," he said.

On rupee, the report said that the Indian currency is likely to remain under pressure primarily owing to the speculation regarding the US Federal Reserve scaling back its stimulus besides oil related dollar demand.

"D&B expects the rupee to average at around 62.60-62.80 per USD during November 2013," it said.

The rupee is currently hovering over the 62.80/US dollar level.