Low base on public spending boosts GDP

The government's frontloading of investments was a key driver of stronger-than-expected economic growth in the April-June quarter, with the impact amplified by the low base of the previous financial year.

- Mukesh Jagota

The April-June quarter of last year coincided with the general elections. With the Model Code of Conduct in force, no new projects could be taken up. In addition, much of the government staff and officials were engaged in the election process, delaying routine clearances. As a result, last year's low base magnified this year's growth, with central government capital expenditure rising 52% year-on-year to ₹2.75 lakh crore in April-June.