India Q1 GDP is up 13.5%, but lower than RBI estimate

India’s economy grew 13.5 per cent from a year ago in the April-June quarter this fiscal, its fastest year-on-year growth rate in four quarters. It was led by higher household consumption, especially of contact-intensive services, and buoyant investment activity, as compared to the same quarter of the last fiscal that bore the brunt of the second Covid-19 wave.

But this was lower than the Reserve Bank of India estimate that the GDP growth rate was likely to be around 16.2 per cent in the first quarter. Finance Secretary T V Somanathan said the Indian economy is “on course” to achieve over 7 per cent growth this fiscal.

“It (Q1 GDP) is good enough to achieve the rate of growth that we think everyone including the IMF and RBI have expected as real GDP growth for four quarters of this year. We are on course to achieve more than 7 per cent GDP growth in the year, in the range 7.0-7.5 per cent. The IMF has predicted 7.4 per cent,” he said at a briefing.