GDP numbers suggest private capex gaining steam, say experts
GDP numbers driven by a strong rebound in the manufacturing sector suggest that private capex spending is gaining steam, experts said. India's economy grew 7.6 per cent in the September quarter of this fiscal and remained the fastest-growing large economy, mainly due to better performance by manufacturing, mining and services sectors, the government data showed on Thursday.
The gross domestic product (GDP) expanded by 6.2 per cent in the July-September quarter of 2022-23.
India remained the fastest-growing major economy, as China posted a 4.9 per cent growth in July-September 2023.
The GVA (Gross Value Added) in the manufacturing sector showed a growth of 13.9 per cent in the second quarter of the current fiscal compared to a contraction of 3.8 per cent in the year-ago period.
The double-digit growth in the industry sector, especially in manufacturing and construction, is suggesting that businesses ramped up production to meet the pent-up demand just before the festivals, said Rumki Majumdar, Economist, Deloitte India.
«Investment data also points to the fact that private capex spending is gaining steam — government capex is now crowding in private spending in households and corporates,» Majumdar added.
Commenting on the data, Aditi Nayar, Chief Economist, Icra, said the surprise was largely led by the manufacturing sector, with growth surging to a nine-quarter high of 13.9 per cent from 4.7 per cent in the first quarter, led by a favourable base, an uptick in volume growth and an improvement in profit margins owing to continued deflation in input prices.
