Economic growth declines to 5.3 per cent in July-Sept quarter

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The Indian economy grew by 5.3 per cent in the July-September period of the current financial year (2012-13), pulled down by poor performance of manufacturing and agriculture sectors, showing persistent signs of slowdown.

The gross domestic product (GDP) had expanded by 6.7 per cent in the same period of last fiscal.

It had grown by 5.5 per cent in the first quarter (April-June) of 2012-13.

During the three-month period ended September 30, the manufacturing sector grew marginally by 0.8 per cent, against 2.9 per cent growth in the same period of 2011-12, according to data released by the Central Statistical Organisation (CSO) on Friday.

Farm sector output expanded by just 1.2 per cent in the July-September period this fiscal against 3.1 per cent in the same period last year.

Mining and quarrying sector, however, showed some improvement and recorded a growth of 1.9 per cent during the quarter, as against a contraction of 5.4 per cent in the second quarter of 2011-12.

The economic growth in the first six month of this fiscal (April-September) is 5.4 per cent, lower than 7.3 per cent growth clocked in the year-ago period.

In the July-September quarter, trade, hotels, transport and communications segment also witnessed lower pace of growth at 5.5 per cent compared to 9.5 per cent expansion in the same quarter in year ago.

The growth rate of electricity, gas and water supply also dipped to 3.4 per cent in the second quarter, from 9.8 per cent witnessed in the same quarter of 2011-12.

Construction sector expanded by 6.7 per cent Q2 of 2012-13, as against 6.3 per cent in the year-ago period. Growth rate of services sector, including insurance and real estate, stood at 9.4 per cent in the second quarter, against 9.9 per cent recorded in same quarter last fiscal.

Finance Minister P. Chidambaram had earlier said that the economy faces a 'difficult situation' and the way to overcome this difficult situation is through innovation and increasing the production of goods and services.