Press Information Bureau

Government of India

Ministry of Finance

31-August-2012 15:22 IST

FM’S Statement Regarding GDP Numbers for First Quarter for 2012-13; Emphasizes Once Again the Need to take Quick Decisions to Accelerate Investments and Removing all Bottlenecks to Investments

The first quarter GDP numbers for 2012-13 were released by CSO today. Growth in real GDP (GDP at factor cost at constant (2004-05) prices) for the first quarter (Q1) of 2012-13 is placed at 5.5 per cent as against 8.0 per cent in Q1 of 2011-12. This is a little more than the growth rate of 5.3 per cent achieved in Q4 of 2011-12.

After the continuous reduction in the growth rate in successive quarters beginning in the fourth quarter of 2010-11, this is the first time when quarterly growth rate has exceeded the growth rate in the previous quarter.

Of course, the decline in the growth of fixed investment (0.7 per cent in Q1 of 2012-13 as against 14.7 per cent in Q1 of 2011-12) is a source of concern to Government. It emphasizes once again the need to take quick decisions to accelerate investments, especially removing all bottlenecks to investments in the manufacturing sector.

At the same time, there are also encouraging signs such as the growth of the construction sector at 10.9 per cent (Q1 of 2012-13) as against 3.5 per cent in Q1 of 2011-12.

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DSM/RS/GN

Accelerate investments: government urges swift decisions to remove bottlenecks after slowdown in fixed investment and support manufacturing recovery. The Finance Ministry reports Q1 real GDP growth at 5.5 per cent, notes a prolonged quarterly deceleration trend, and identifies a sharp decline in fixed investment as a key concern. The Ministry emphasizes the need to accelerate investments and to remove investment bottlenecks-especially in manufacturing-while acknowledging strong construction sector growth and urging rapid policy action to stimulate investment.