India's GDP growth in the September quarter was 5.4%, the lowest in seven quarters and below the Reserve Bank of India's projection of 7% for Q2FY25, according to the Ministry of Statistics and Programme Implementation.

The decline was mainly due to weaknesses in the manufacturing and mining sectors. Aditi Nayar from ICRA suggested that this could result in a shortfall in government capital expenditure, potentially missing the target by around Rs 1 trillion for the fiscal year. However, Nayar remained optimistic about agricultural growth in the latter half of the year, citing the anticipated normal monsoon as a positive factor.

In response to the current economic conditions, Nayar expected the central bank to maintain a status quo in its December meeting, with a higher likelihood of a rate cut in February.