ICRA expects the pace of growth of real GDP at factor cost to print at a lower 5% in Q2FY15 as compared to 5.7% in Q1FY15, on account of factors such as an unfavourable kharif harvest, sluggish manufacturing performance, slowdown in export growth and moderation in the pace of expansion of Central Government spending. In terms of the sectoral components, GDP growth would be dampened by a slowdown in agriculture (0.5% in Q2FY15; 3.8% in Q1FY15) and industry (~2.6% in Q2FY15; 4.2% in Q1FY15), offset to a small extent by a slight uptick in the services sector (6.9% in Q2FY15; 6.8% in Q1FY15).

''The Index of Industrial Production (IIP) indicates that manufacturing output rose by a negligible 0.1% in Q2FY15, inferior to the 3.9% growth in Q1FY15, with a perceptible moderation across capital goods, intermediate goods, consumer durables and consumer non-durables,'' said ICRA. ''Additionally, growth eased in Q2FY15 relative to the previous quarter for mining output and electricity generation. Lead indicators of service sector performance indicate a mixed trend for Q2FY15.''

''The performance of air traffic (cargo and passengers), tourist arrivals and systemic deposits of the Banking sector improved in Q2FY15 as compared to Q1FY15. However, the pace of growth non food credit growth of the Banking sector, revenue expenditure of GoI and services exports declined in Q2FY15,'' it added.