India's GDP: India's GDP growth fell sharply to 5.4% in the July-September quarter, an 18-month low, according to data released by the National Statistical Office (NSO) on Friday (November 29). The figure was well below the Reuters poll estimate of 6.5% and represents a sharp decline from 6.7% in the April-June quarter and 8.1% in the same period last year.

Gross value added (GVA), which measures economic activity across sectors, grew by 5.6%, also missing the forecast of 6.5%. This was a significant slowdown from 7.7% year-on-year and 6.8% growth in the previous quarter. Sectoral performance during the quarter presented a mixed picture. Agriculture registered a growth of 3.5%, up from 2% in the previous quarter and 1.7% a year ago. However, the mining sector declined by -0.1%, a sharp reversal from 11.1% growth year-on-year and 7.2% in Q1FY25.

What things declined?

Manufacturing growth slowed significantly to 2.2%, compared to 14.3% in the same quarter last year and 7% in the previous quarter. The power segment slowed to 3.3% from 10.5% year-on-year and 10.4% sequentially. Construction, the key driver of economic activity, recorded a growth of 7.7%, down from 13.6% growth a year ago and 10.5% in Q1FY25. Trade, hotels, and transport grew 6% compared to 4.5% year-on-year and 5.7% sequentially.

Financial, real estat,e and professional services grew 6.7%, a marginal improvement from 6.2% a year ago but lower than the 7.1% recorded in the previous quarter. Public administration and other services, which also includes government spending, grew 9.2%, up from 7.7% last year but slightly lower than 9.5% in Q1FY25.