India’s economic growth decelerated significantly in July-September, reaching 5.4 per cent year-on-year, data from the Ministry of Statistics and Programme Implementation (MoSPI) said on Friday.

The estimates are considerably below the estimate of analysts – 6.5 per cent and the central bank’s 7 per cent. For Q2 FY 2023-24, the Real GDP was 8.1 per cent.

As per the MoSPI, Real GDP in Q2 of 2024-25 is estimated at Rs 44.10 lakh crore, against Rs 41.86 lakh crore in Q2 of 2023-24.

Nominal GDP or GDP at Current Prices in Q2 of 2024-25 is estimated at Rs 76.60 lakh crore, against Rs 70.90 lakh crore in Q2 of 2023-24.

Urban consumption weakened due to increased food prices. The figure showed a decline from the previous quarter’s 6.7 per cent.

Economic activity measured by gross value added (GVA) showed 5.6 per cent growth, down from 6.8 per cent in the preceding quarter.

Real GVA in Q2 of 2024-25 is estimated at Rs 40.58 lakh crore, against Rs 38.42 lakh crore in Q2 of 2023-24, showing a growth rate of 5.6 per cent.

Nominal GVA in Q2 of 2024-25 is estimated at Rs 69.54 lakh crore, against Rs 64.35 lakh crore in Q2 of 2023-24, showing a growth rate of 8.1 per cent.

MoSPI data said the Agriculture and Allied sector has bounced back by registering a growth rate of 3.5 per cent in Q2 of FY 2024-25 after sub-optimal growth rates ranging from 0.4 per cent to 2.0 pc, observed during previous four quarters.

Tertiary sector has observed a growth rate of 7.1 per cent in Q2 of FY 2024-25, as compared to the growth rate of 6 per cent in Q2 of the previous financial year, the data said.

In particular, Trade, Hotels, Transport, Communication and Services related to broadcasting has seen a growth rate of 6 per cent in Q2 of FY 2024-25 over the growth rate of 4.5 per cent in Q2, 2023-24, it added.

Speaking on the GDP data, Upasna Bhardwaj, Chief Economist, Kotak Mahindra Bank, said, “The sharply lower than expected GDP figures reflects the highly disappointing corporate earnings data. The manufacturing sector appears to have taken the maximum beating. The high frequency data suggests that festive linked revival in activity may provide a marginally better 2H growth figure but overall GDP growth for FY25 is going to be around 100bps lower than RBI’s estimate of 7.2 per cent.”

For the first half of 2024-25, April-September, (H1 2024-25), the real GDP is estimated at Rs 87.74 lakh crore, against Rs 82.77 lakh crore, showing a growth rate of 6 per cent.

The Nominal GDP in H1 is estimated at Rs 153.91 lakh crore, against Rs 141.40 lakh crore, showing a growth rate of 8.9 per cent.

Real GVA in H1of 2024-25 is estimated at Rs 81.30 lakh crore, against Rs 76.54 lakh crore in H1, 2023-24, showing a growth rate of 6.2 per cent.

On the other hand, the Nominal GVA in H1 of 2024-25 is estimated at Rs 139.78 lakh crore, against Rs 128.31 lakh crore in H1, 2023-24, showing a growth rate of 8.9 per cent.