July-Sept GDP may be revised upwards, 6.5-7 per cent growth in FY’25 feasible: CEA Nageswaran

Chief Economic Adviser V Anantha Nageswaran on Thursday said economic activity in some sectors have picked up pace during October-November and a GDP growth of 6.5-7 per cent in the current fiscal is feasible.

He also said that the 5.4 per cent second quarter GDP growth estimate could be revised upwards going forward, as the current estimates are not seasonally adjusted.

“I think in reacting to these numbers, I don’t think we should throw the baby out with the bathwater. Because the underlying growth story still remains very much intact,” Nageswaran said.

India’s economic growth slowed to a seven-quarter low of 5.4 per cent in the July-September quarter, from 6.7 per cent in the April-June quarter.

Nageswaran said the slowdown in GDP growth in the second quarter could be because of some “religious observances” in September and excess monsoon rainfall, could be also because of other more long-standing issues that are beginning to emerge.

So explanations could be from mundane to more serious ones, he said, adding this is the first estimate for second quarter GDP growth. “It could be revised higher,” Nageswaran said.

He said the Economic Survey had projected 6.5-7 per cent for financial year 2024-25. “To be able to hit 6.5 per cent growth for the year as a whole, we need a 7 per cent real GDP growth in the next two quarters of which two months are already over in the third quarter. We are in the third month.

“I think that it is doable if you look at some of these pickups that have happened in specific areas. So I believe that a growth outcome in the range of 6.5-7 per cent is feasible for the year,” Nageswaran said at an Assocham event.

The Indian economy grew 8.2 per cent in the 2023-24 financial year.

The Reserve Bank of India (RBI) had projected growth to be 7.2 per cent in current fiscal, higher than 6.5-7 per cent projected in the Finance Ministry’s Economic Survey.