August GDP grows 4.6% Versuus 4.4 in July : ZyFin

However, the firm said that high inflation could dampen the prospect of a growth recovery this year

India’s economic growth refuses to perk significantly, said research and analytics firm ZyFin on Wednesday. It estimated gross domestic product (GDP) expanded 4.6 per cent in August, a shade higher than 4.4 per cent in July.

The firm said high inflation could dampen the prospect of a growth recovery this year. The GDP deflator, a measure of inflation, was estimated to be 6.6 per cent for August, against 6.2 per cent in the previous month. “Recent acceleration in inflation is again proving a major contributor in accentuating the prevailing economic slowdown,” said Debopam Chaudhuri, vice-president (research) at ZyFin.

The firm said the uptick in growth was due to slight recovery in manufacturing and agriculture. “The positives are manufacturing and agriculture, as there is some recovery seen in these sectors this month,” said Chaudhuri.

According to ZyFin estimates, agriculture grew at the same pace of 3.2 per cent as in the previous month. However, the manufacturing sector grew 2.5 per cent, against 1.1 per cent in July. Services rose 4.9 per cent, compared with five per cent in July.

Surjit S Bhalla, Senior Advisor, ZyFin Research said, “The Indian economy continues to be in crisis mode. Since Q1 of 2011, GDP growth has averaged only 5.2 per cent for the last 33 months, a shocking decline from the 8.8 per cent growth recorded in calendar year 2010. It remains to be seen whether GDP growth declines further from the 4.1 per cent level recorded in August 2013.”

Construction segment also picked up as it expanded 1 per cent in August compared to 0.2 per cent in the previous month.