Updated February 29th, 2024 at 15:42 IST

Economic growth likely slowed to 6.7-6.9% in December quarter: Report

Despite India maintaining its status as the world's fastest-growing major economy, the expected growth rate for Q3 falls slightly below RBI's projection of 7%.

Reported by: Business Desk
Indian economy | Image:Unsplash
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GDP growth outlook: The Indian economy is set to witness a slowdown, with growth expected to range between 6.7-6.9 per cent in the December quarter of FY24, as per a report by the research arm of country’s largest lender State Bank of India SBI Research, said in a report.

The projection marks a decline from the previous quarter's growth rate of 7.6 per cent. The report, released on Wednesday, underscores the primary culprit behind this deceleration as the underperformance of the farm sector.

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Despite India maintaining its status as the world's fastest-growing major economy, the anticipated growth rate for the December quarter falls slightly below the Reserve Bank's projection of 7 per cent. The report also forecasts a GDP growth rate of 6.8 per cent in the fourth quarter.

The subdued growth outlook stems from challenges within the agricultural sector, notably the decline in production of major Kharif crops and concerns over reduced sown areas under cereals during the rabi season. Particularly, the fisheries sector has been significantly affected.

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However, amid agricultural challenges, corporate results from approximately 4,000 listed entities for third quarter of current financial year paint a contrasting picture. The results indicate robust growth, with profit after tax (PAT) soaring by over 30 per cent and topline increasing by approximately 7 per cent compared to the same period in the previous year.

Meanwhile, there has been a noticeable improvement in margins among listed entities, excluding the banking, financial services, and insurance sectors, with margins hitting 14.95 per cent in December quarter, compared to around 12 per cent in the corresponding period of the previous year.

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Published February 29th, 2024 at 15:05 IST