5

Mar

Economic Scenario Becoming Cause of Deep Concern

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Prashant Gautam

New Delhi | Wednesday | 5 March 2025

The huge turmoil in the stock market and the latest figures about the growth rate have become a cause of deep  concern  about our  economy despite all the brave talk of the odi Government. According to the data released by the National Statistical Office (NSO), the country's economic growth rate declined to 6.2 per cent in the past October-December quarter of the current financial year.

 A serious  matter of concern is the fact  that the performance in mining, manufacturing and all other sectors except agriculture has been  poor slowing down the economic growth rate. However, the relief is being felt in the fact that since the growth rate in the previous quarter i.e. Jul y-September, 2024 was 5.6 per cent, the figures of the subsequent quarter  indicated an improvement  showing  the  economy gaining momentum. But any improvement can be assessed only on the basis of the data of the entire financial year.

It is worth noting that in the October-December quarter of 2023, the growth rate of Gross Domestic Product (GDP) was reported to be 9.5 per cent. Such a huge shortfall in the growth rate  within a year from the same quarter of last year strongly  indicates the need for  concrete steps  to  correct  the course and direction of the country's economy.

 

Article at a Glance
The recent turmoil in the stock market and declining economic growth rates have raised concerns about India's economy, despite the Modi Government's optimistic rhetoric.
According to the National Statistical Office (NSO), the country's growth rate fell to 6.2% in the October-December quarter, down from 9.5% in the same period last year. Key sectors like mining, manufacturing, and construction have underperformed, although agriculture showed a slight improvement with a 5.6% growth.
The government’s lack of proactive measures to address these economic challenges is troubling, especially as global market instability, exacerbated by U.S. tariff policies, continues to impact India's stock market negatively. Overall, the situation calls for urgent corrective actions to stabilize the economy.

 

 Before the latest figures of NSO came, while releasing the second estimate of the growth rate for the current financial year, it was estimated to be 6.5 per cent. In this sense, the growth rate remained more or less around. But parallel to this, the growth rate in the mining and production sector declined from 4.7 percent a year ago to 1.4 percent in the third quarter. Apart from this, a decline in the growth rate was also recorded in the construction sector, service sector, trade, hotels, transport, financial, real estate business, professional services, communication and broadcasting related services. Thus, the increase in production by 5.6 per cent in the agricultural sector in this quarter can be seen as a relief.

It is unfortunate that despite the existence of many complexities on the economic front, the government is not making any efforts to look for alternative arrangements to overcome the problems. If the growth rate is not satisfactory even during the festive season of October-December, then it shows that whatever may be the claims of the government  about economic development, its efforts to improve things  at the ground level are half-hearted.

 On the other hand, after the announcement of new tariff policies  and other economic measures by the U.S.  President Donald  Trump, there has been a huge decline in the stock markets around the world. There are  the fears of a global trade war. Under this pressure, the benchmark index of India's domestic stock market is constantly declining making the situation even more complicated.

( The writer is chief sub-editor of www.mediamap.co.in website)

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