GDP Q2 growth slips to 8.9 per cent

New Delhi, Nov 30: Hit by a slowdown in manufacturing, the country's economy has come down at 8.9 per cent during the July-September quarter from 10.2 per cent in the corresponding period last year.

Despite a good show from the agriculture sector, which grew at 3.6 per cent for the second quarter as compared to 2.9 per cent over the same period a year ago.

The growth during the first half of 2007-08 came down to 9.1 per cent from 9.9 per cent in the previous year, according to official data released today.

The farm sector growth came in at 3.6 per cent as against 2.9 per cent in the same quarter last year.

The cumulative impact of monetary tightening in the last few quarters, along with the likely impact of rupee appreciation on exports, is likely to moderate the pace of growth for the rest of the year.

Rise in interest rates and the RBI's active discouragement in the form of monetary tightening have meant that financing and real estate growth has slipped from 11.1 in the corresponding quarter last year to 10.6 per cent in the second quarter of the current fiscal.

The housing loan figures have shown that the increase year-on-year for the period ended August 17 this year was 16.6 per cent, as against an increase of 30.3 per cent in the period up to December last year.

Expansion also slowed in the service sector, which grew by 10.2 per cent compared to 11.8 per cent in the corresponding quarter last year.

Mining sector growth increased to 7.7 per cent up from just 3.9 per cent in the July-September quarter last year.

UNI