“There are no signals of a recovery in industries right now. . .except the fact that exports have started picking up and we have witnessed good rains,” said D K Joshi, chief economist, CRISIL.
"In July, exports rose 11.6 per cent to $25.83 billion year-on-year, against contraction in the two preceding months.
Joshi added as a result of the good monsoon, there could be some pick-up in durable goods and this could lead to a slight rise in industrial production.
“Industries could grow around 3.5 per cent in 2013-14, which is a mild recovery over a very weak base,” he said. In 2012-13, industrial production increased just one per cent.
Joshi said there could be some spark of a recovery but unless supported by investments, that would be temporary.
“There is no chance of a revival unless there are some signals of project announcements and investments picking up. At this juncture, the future is bleak,” said Joshi.
He added he expected GDP growth to stand at 4.5-5 per cent in the first quarter.
In the quarter ended June, the industrial sector had contracted 1.1 per cent.
Services, which accounts for the major portion of GDP (55 per cent if construction is excluded), would be a crucial factor in determining the course of GDP growth.
Experts said much of what happens in this sector depends on industries and agriculture.
CARE Ratings Chief Economist Madan Sabnavis said GDP growth in the quarter ending September could be flatter than in the first quarter.
“Usually, in the second quarter, no harvest takes place, as in the first.
"Also, the government is going slow on fiscal spending.
"Therefore, for services, the second quarter could be flatter than the first,”
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