The latest GDP print—a modest rebound to 6.2% in Q3 2024-25—brought fleeting economic optimism, but also exposed a disquieting undercurrent. Growth may have rebounded from a revised 5.6% in July-September, as expected, yet the underlying economic weakness persists.Manufacturing growth, for instance, crawled to 3.5% from 2.1% in the previous quarter, while gross fixed capital formation, a proxy for investments, declined to 5.7%. This was despite the Centre’s aggressive capital expenditure after the election-related slowdown. These trends underscore a deeper concern: the economy is operating below potential, and incremental rate cuts alone will not suffice.
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