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Our Bureau

New Delhi , Sept 30

BELYING negative projections, the Government today presented an impressive economic report card that shows that the economy grew 8.1 per cent in the first quarter of the current fiscal, against 7.6 per cent in April-June 2004.

The higher growth in the initial months of the current fiscal was brought about by a buoyant manufacturing sector, which grew 11.3 per cent, and the services sector, which continued with its robust performance.

Defying predictions: The growth rate in manufacturing was 7.9 per cent in April-June 2004 and 8.9 per cent for the full year 2004-05.

But this sector had showed distinct signs of deceleration in the last quarter, particularly in February and March 2005, and expert opinion available with the Government had indicated that this soft patch was to continue for some time.

However, the latest Central Statistical Organisation (CSO) data has overturned these predictions.

Farm, mining poor: Agriculture continued to be a laggard, as was expected, growing only two per cent during the first quarter against 3.8 per cent earlier.

Mining also reported a poor performance, growing only 3.2 per cent, sharply down from 6.9 per cent earlier. The lower crude oil production this year pulled down the mining sector.

The CSO also released the quarterly estimates of gross domestic product (GDP) for April-June 2005 today.

According to this data, the quarterly GDP at factor cost at constant (1993-94) prices for the first quarter of the current fiscal is estimated at Rs 3,82,534 crore (Rs 3,53,717 crore in Q1 of 2004-05), reflecting a growth rate of 8.1 per cent over the corresponding quarter of previous year.

Major growth sectors: Apart from manufacturing, the sectors that registered significant growth in the first quarter of the current fiscal are electricity, gas and water supply at 7.9 per cent (6.1 per cent), construction at 7.9 percent (five per cent), trade, hotels, transport, and communication at 12.4 per cent (11.5 per cent), and financing, insurance, real estate, and business services at 8.3 per cent (seven per cent).

The GDP (at current prices) in the first quarter of 2005-06 was estimated at Rs 7,25,945 crore, reflecting an increase of 12.8 per cent over the GDP level of Rs 6,43,645 crore recorded in the same period last year.

Chidambaram confident: Exuding optimism over the growth prospects for the rest of the year, the Finance Minister, Mr P. Chidambaram, has said that his aim is to ensure over eight per cent GDP growth in the medium term.

"In the medium term, my goal is to grow at over eight per cent. This would require higher savings and investment rates," he said, reacting to the GDP numbers released on Friday.

Mr Chidambaram added that the aim should be to make India the fastest growing economy in the world.

"We are now the second fastest economy in the world (after China). We must aim to be the fastest growing."

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