NEW DELHI (AFP) –
India's economy expanded by 6.1 percent in the three months to June, picking up pace from the previous quarter as the country emerged from the global downturn, official data showed Monday,
The quarterly growth figure was up from the 5.8 percent growth posted in the March quarter, but analysts say a widespread drought could weaken momentum in coming months.
The data announced by India's Central Statistical Organisation was broadly in line with analysts' forecasts of around six percent growth. The economy grew by 7.8 percent in the same year-earlier quarter.
Finance Minister Pranab Mukherjee has projected growth of "six percent plus" for the fiscal year to March 2010, down from the 6.7 percent logged last year and far below scorching annual nine percent levels in the previous three years.
However, India has weathered the global economic downturn far better than many of its Asian counterparts that fell into recession, thanks to its still domestically focused economy.
But the worst monsoon in at least seven years has sparked concern about growth expectations in an economy where rural demand is a key consumption driver.
Last weekend, Prime Minister Manmohan Singh said India faces a "severe drought" with some 40 percent of the country's districts suffering poor rains.
The monsoon rains are a lifeline for agriculture, which supports more that half of India's nearly 1.2 billion population.
But economists expect weaker farm output to be offset by a good industrial performance.
"We expect (full-year) growth to be somewhere close to six percent," said Dharmakirti Joshi, principal economist at India's leading credit rating agency Crisil.
"I don't think the drought will mess up growth prospects too much. While agriculture growth will be hit, other areas will pick up, such as industry," he told AFP.
Local carmakers, for instance, have reported a surge in sales with the nation's largest auto manufacturer, Japanese-owned Maruti Suzuki, announcing a 33.4-percent jump in purchases in July.
Data released Monday showed that agriculture grew by 2.4 percent in the quarter, down from 3.0 percent a year earlier.
But mining expanded by 7.9 percent, up from 4.6 percent from the corresponding year-ago period. Utilities grew by 6.2 percent, up from 2.7 percent, while finance and property rose by 8.1 percent, up from 6.9 percent.
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