Nominal GDP saw a growth rate of 9.7 per cent in Q1 FY25 compared to 8.5 per cent in the year-ago period.

Central bank governor Shaktikanta Das attributed the slowing of India’s economic growth to ‘lower’ government spending in the wake of the enforcement of the model code of conduct for the recent general elections.

Real gross value added (GVA) grew by 6.8 per cent in Q1 FY25 over 8.3 per cent in Q1 FY24, driven by the secondary sector (8.4 per cent), which includes the manufacturing (7 per cent) sector.

Growth rate in nominal GVA for Q1 FY25 was an estimated 9.8 per cent over 8.2-per cent in Q1 FY24, a release from the ministry of statistics and programme implementation (MoSPI) said.

Increased capital expenditure (capex) by the private sector and households lifted growth in capital investment to 7.5 per cent in Q1 FY25 from 6.46 per cent in the preceding quarter, the data showed.

Gross fixed capital formation (GFCF), which represents infrastructure investment, grew by 7.5 per cent at constant prices in Q1 FY25, and contributed 31.3 per cent to GDP compared to 31.5 per cent in the preceding quarter. An investment share above 30 per cent is considered important for driving economic growth.

Growth in private final consumption expenditure (PFCE), which is taken as a proxy for household consumption, grew strongly to a seven-quarter high of 7.4 per cent during Q1 FY25 from 3.9 per cent in Q4 FY24, due to a partial correction in skewed consumption demand. The share of PFCE in GDP rose to 60.4 per cent during the quarter compared to 57.9 per cent in Q4 FY24.

Fibre2Fashion News Desk (DS)