India's Q1 GDP growth News

From the RBI's perspective, the GDP data are disappointing, but the current slowdown is largely due to GST, which should be seen as transitory, Japanese financial services major said, adding the cash-intensive sectors like trade, transportation and construction are rebounding.

Experts feel demonitisation and huge destocking before the launch of the Goods and Services Tax (GST) can be the reasons for the unexpected slow down of India`s economic growth to 5.7 percent in the June quarter, the slowest pace in three years.

Explaining the lower GDP growth as against the GVA growth, HSBC said a large subsidy outgo will likely depress the net indirect taxes (NIT) growth which will result in slower GDP.

Attributing the slowdown in first quarter GDP to higher subsidy outgo, Finance Ministry on Wednesday expressed confidence that good monsoon and impact of pay commission award will push the economic growth close to 8 percent in the current fiscal.

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Observing that the first quarter is the period between April and June 2014, he said it was the UPA government that was in charge until May 26, 2014.

India's Gross Domestic Product had expanded by 4.7 percent in April-June quarter of the last fiscal ended March 31.

Buoyed by performance of mining, manufacturing and services sector, Indian economy has bounced back to record a growth rate of 5.7 percent.

India`s faltering economy grew at its fastest pace in over 10 quarters during the first quarter of this year, government data showed on Friday.