India's economy grew at its slowest pace in more than six years in July-September period, official data showed on Friday. The country's Gross Domestic Product or GDP grew 4.5 per cent in the second quarter of current financial year compared with 5 per cent in the previous quarter, and 7 per cent in the July-September period of 2018. The GDP data was worse than economists' estimates. According to a poll conducted by news agency Reuters, economists had expect GDP growth at 4.7 per cent in July-September.
The pace of economic growth fell below the 5 per cent mark for the first time since January-March period of 2013 when GDP grew at 4.3 per cent.
Friday's data disappointed many economists who had pinned their hopes on the recently-concluded festive season for a pickup in demand.
The government has exuded confidence that economic growth will pick up soon. It has over the past few months announced a series of measures to stimulate the economy, ranging from withdrawal of higher taxes on foreign investors, a mega merger plan for state-run lenders and a reduction in corporate taxes.
Finance Minister Nirmala Sitharaman this week acknowledged the slowdown in economy. "Growth may have come down, but its not recession yet or it won't be recession ever," she said during a debate in Rajya Sabha on Wednesday.
The Reserve Bank of India has also been lowering the repo rate to push economic expansion.It has so far this year cut the repo rate five times by 135 basis points. Many economist expect the central bank to again cut interest rates at its December policy meet by 25 basis points making it the most aggressive central bank in the world.
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