India GDP
India's GDP growth is likely to be impacted due to government's demonetisation move. (Representational Picture)Reuters

India's gross domestic product (GDP) for the quarter ending September 30 rose by 7.3 percent over the same period last fiscal on the back of sound growth in services sector.

During the previous quarter (April-June), GDP growth rate was at 7.1 percent, slowest in six quarters.

According to the data released by the Central Statistics Office (CSO), services sector led the growth rate during this period with segments like financial, insurance, real estate and professional services growing over 7 percent.

Public administration, defence and other services, trade, hotels, transport and professional services also reported a growth rate of more than 7 percent during this period.

Agriculture sector recorded a growth rate of 3.3 percent compared with a rate of 2 percent recorded in the same quarter of previous fiscal.

Meantime, manufacturing sector witnessed a slowdown with growth rate coming at 7.1 percent compared with 9.1 percent recorded in the previous quarter.

"IIP (index of industrial production) manufacturing contracted by 0.9 percent during Q2 of FY17 as compared to 4.7 percent reported in the same quarter of last fiscal," the CSO said. In the mining and quarrying segment, there was a de-growth of 1.5 percent during July-September quarter.

India overtook China to be the fastest growing large economy in the world in 2015. However, the recent decision of the government to ban high-value currencies has raised concerns among analysts that the country might have to shed the tag as continuing cash crunch is likely to derail GDP numbers.

Meantime, investment activity during the last quarter fell with gross fixed capital formation (GFCF) contracting 5.6 percent in July-September of 2016-17.