India is expected to report its economy grew about 4.9 per cent in the second quarter of 2002-03 fiscal year, boosted by robust industry and services sectors, a Reuters poll showed.
The Indian economy, Asia's third largest, grew six per cent in the first quarter of 2002-03 (April-March) boosted by strong services and farm sector growth. It grew 5.3 percent in the July-September quarter of 2001-02.
The government expects the economy of the country of more than a billion people to grow about 5.0-5.5 per cent in the year to March 2003 but a devastating drought is expected to have some impact.
"Growth would be helped by services sector and industry, which are expected to grow at eight and six per cent respectively," Pyarelal Raghavan, economist with the Federation of Indian Chambers of Commerce and Industry, a leading industry lobby group.
"But because of the drought agriculture will witness a decline." Nearly 70 per cent of India's population depends on farming for their livelihood.
Rainfall during this year's southwest monsoon, which runs from June to September, was the lowest in 14 years, leading to a drought in several parts of the country.
The government has also said that besides the drought, a 10-month military standoff with Pakistan, high international oil prices and uncertainty about the global economy are expected to pose challenges to growth.
The Indian economy, the world's 12th largest, started emerging from a slowdown earlier this year and a slew of data in recent months has confirmed the belief that the recovery process was gathering steam.
India's industrial output rose 6.2 per cent in October year-on-year, boosted by strong growth in manufacturing and electricity. Industry accounts for a quarter of India's GDP and services more than 50 per cent.
Sales of automobiles and consumer non-durables from shoes-to-shampoos-have grown at a scorching pace confirming that demand has picked up.
Analysts say late rains in August and September have helped ease the impact of the drought to some extent.
"Industrial growth is the saving grace in the second quarter," said Riyaz Khan, macro-economist with the Centre for Monitoring Indian Economy.
The average growth forecast of 10 analysts surveyed by Reuters on Monday was 4.9 per cent with the lowest estimate at 4.2 per cent and the highest six per cent.
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