India's Economic growth slows down to 6.1% in fiscal 2011-12 Q3; lowest in 2 yrs

New Delhi, Feb 29 (PTI) India's economic growth rate slipped to 6.1 per cent in constant price terms at factor cost in the third quarter of the current 2011-12 fiscal (October-December), lowest in more than 2 years due to poor performance of the manufacturing, mining and farm sectors. The Gross domestic product (GDP) growth in third quarter of the previous fiscal in 2004-05 price terms was 8.3 per cent, as per the latest data released by the Indian government today. GDP during the first three quarters of 2011-12 fiscal (April-December) also moderated to 6.9 per cent from 8.1 per cent in the first nine months of 2010-11. During the quarter ending December 31, growth in the manufacturing sector dipped to a meagre 0.4 per cent from 7.8 per cent in the corresponding period of 2010-11. Farm output also exhibited a similar trend and expanded by just 2.7 per cent during the quarter, compared to 11 per cent in the corresponding period of last fiscal. Mining and quarrying production contracted by 3.1 per cent during the quarter under review, as against a growth of 6.1 per cent in Q3 of last fiscal. GDP during the quarter has been estimated at Rupees 13,396 billion (about USD 275 billion at current exchange rate) in constant price terms at factor cost compared to the 2010-11 third quarter figure of Rs 12,628 billion (about USD 257 billion). The advance estimates data of GDP for fiscal 2011-12 released earlier this month by the Central Statistics Office pegs India's GDP growth for the year at 6.9 per cent. It had expanded by 8.4 per cent in 2010-11. As regards growth during the first three quarters of fiscal 2011-12, manufacturing slowed to 3.4 per cent as compared to 7.6 per cent during the same period a year ago. During April-December, output of mining and quarrying sector declined by 1.4 per cent as against a positive growth of 6.7 per cent in same period last fiscal. Furthermore, the agriculture, forestry and fishing sector grew by just 3.2 per cent in the nine month period, as against 6.8 per cent expansion a year ago. GDP during the first three quarters of the current fiscal amounted to Rs 38,070 billion (about USD 777 billion) in constant price terms at factor cost compared to Rs 35,623 billion (about USD 727 billion) during the first three quarters of 2010-11 fiscal. The slowdown in the manufacturing sector, coupled with decline in mining and quarrying, is likely to put pressure on the Reserve Bank of India to cut interest rate at its mid-quarter monetary policy review on March 15. Finance Minister Pranab Mukherjee too, in his Budget for 2012-13, to be presented on March 16 in Parliament, is expected to announce steps for arresting economic slowdown. India Inc has been blaming RBI's inflation control oriented tight monetary policy, which has increased the cost of borrowings, for hindering fresh investments and slowing down the industrial growth. PTI