‘GDP slowdown in Q2 not systemic, economic activity to compensate’: Nirmala Sitharaman
The country's GDP grew at 5.4% during the July-September quarter of FY25, the lowest in seven quarters.
The recent slowdown in India's gross domestic product (GDP) growth rate was not “systemic” and economic activity in the third quarter would compensate for the moderation, Finance Minister Nirmala Sitharaman asserted on Friday.
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The country's GDP growth stood at 5.4% during the July-September quarter of FY25, the lowest in seven quarters. On the other hand, the economy grew at 6.7% during the year's first quarter.
Addressing the issue, Sitharaman said at an event in Delhi, “It's not a systemic slowdown. It's more of absence of activity on public expenditure, capital expenditure and so on. I expect Q3 to make up for all these.”
The senior BJP leader added, “So, the growth number is something which is not necessarily going to be badly affected. We need to push up on many other factors.”
Further, the minister stated that factors which affected GDP growth include “plateauing global demand that affected export growth.”
“Purchasing power of Indians is improving, but within India, you also have concerns of wages saturating. We are quite seized of these factors which might have a play on Indian's own consumption,” Sitharaman stated.
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She also praised Prime Minister Narendra Modi, noting that he “looks at an opportunity in challenges.”
“During Covid-19, the challenge was seen as an opportunity to bring reforms. Five mini budgets were presented at the time, each of them giving relief, support and handholding on one hand and on the other making sure that small and overlooked pending reforms were taken,” the finance minister highlighted.
Meanwhile, the Reserve Bank of India (RBI), earlier in the day, announced the decision of its Monetary Police Committee (MPC) to revise the growth projection to 6.6% from the earlier 7.2% for the current fiscal.
(With inputs from PTI)
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