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Consumption, investment concerns remain as Q3 GDP growth surprises on downside

While a decline in GDP growth rate was expected in the third quarter of FY22, the number announced by the statistics ministry on February 28 has surprised on the downside.

February 28, 2022 / 08:46 PM IST
Representative Image

Representative Image

India's Gross Domestic Product (GDP) grew 5.4 percent in October-December 2021 as against 8.5 percent in July-September 2021.

While a decline in growth was expected on account of the favourable base effect dissipating, the extent of the slowdown is larger than anticipated.

A Moneycontrol survey last week had shown economists expected GDP growth to fall to 6.2 percent. However, the growth impulses have clearly not been as strong as expected.

"Overall, Q3 GDP growth was lower than consensus, driven by weak consumption," noted Nikhil Gupta, chief economist at Motilal Oswal Financial Services.