Finance Minister P. Chidambaram Friday said quick decisions are needed to accelerate investments, especially in the manufacturing sector, a major drag on the country's economic growth.
Reacting to the quarterly economic growth data, Chidambaram said some numbers, especially a sharp drop in the growth of fixed investment, were a matter of concern.
"Of course, the decline in the growth of fixed investment (0.7 percent in first quarter of 2012-13 as against 14.7 percent in first quarter of 2011-12) is a source of concern to the government,” the finance minister said.
"It emphasizes once again the need to take quick decisions to accelerate investments, especially removing all bottlenecks to investments in the manufacturing sector,” he added.
According to data released by the Central Statistical Organisation (CSO), the economy grew at a sluggish 5.5 percent in the first quarter of this fiscal in comparison to 8 percent in the corresponding quarter of the previous financial year owing to poor performance of manufacturing, mining and agriculture sector.
Manufacturing grew at a sluggish 0.2 percent in the first quarter.
The first quarter data is slightly better than the 5.3 percent growth registered in the country's gross domestic product (GDP) during the quarter ended March 31, 2012.
“After the continuous reduction in the growth rate in successive quarters beginning in the fourth quarter of 2010-11, this is the first time when quarterly growth rate has exceeded the growth rate in the previous quarter,” Chidambaram said in a written statement.
The finance minister said performance of construction sector was encouraging considering the overall scenario.
"At the same time, there are also encouraging signs such as the growth of the construction sector at 10.9 percent in the first quarter of 2012-13 as against 3.5 percent in the first quarter of 2011-12,” he said.