Economy Slows Down To 8.9% In Q2

A sluggish manufacturing sector pulled down the economic growth to 8.9 per cent during the July-September quarter from 10.2 per cent in the comparable period last year despite a good showing by the agriculture and mining sectors. Consequently the growth during the first half of 2007-08 came down to 9.1 per cent from 9.9 per cent in the previous year, according to data released by the government on Friday.

The major contributor for the slow down-the manufacturing sector recorded a lower growth of 8.6 per cent during the second quarter compared to 12.7 per cent. Barring farm and mining sector, all other segments including the services and transport recorded lower growth. Construction sector recorded an unaltered growth of 11.1 per cent. A tight monetary policy of RBI reducing consumer demand and rupee appreciation dampening exports seem to have pulled down GDP growth in the first six months of current financial year. The growth of financial, real estate and business services slowed down to 10.6 per cent in second quarter as against 11.1 per cent a year ago partially due to RBI measures.