peg growth at 7.1%,higher than ours and consensus estimates of 6.8%.Growth was led by agriculture up 2.6%, industry (including construction) at 4.8%, while services surprised on the upside coming at a robust 9.6%. Looking at GDP by demand, in line with expectations investment growth slowed to single digits for the first time in six years. Consumption growth remained buoyant at 8.2% with the deceleration in the private sector at 6.8% being offset by the pay revision which gets accounted under public consumption up 16.8%.
year FY09 GDP number indicates that growth during Oct08-March09 was 6.4%. This does appear a bit optimistic given that industrial production, exports, tax collections have seen a sharp deceleration and in some cases a contraction. (The CSO releases four sets of GDP data each year- Advance, Updated Advance, Quick and Revised estimates. The Advance estimates are released in February \u2013 two months before close of the year for the current FY. These estimates will be revised in June and finally next year.)
FY09, analysts maintain the FY10 GDP estimate of 5.5%. This factors a contraction in exports, a further deceleration in investment growth and a moderation in consumption. While much has been debated on the impact of the global headwinds on growth, its worth keeping in mind the growing impact of the tailwinds in play. These include the coordinated response to the crisis including monetary and fiscal stimulus as well as a collapse in commodity prices. Both these factors should help enable FY11 growth rising to 6.6%
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