India's GDP increased by 7% in Q3

The Gross Domestic Product (GDP) is a key indicator gauging the health of a country's economy.

It represents the total value of goods and services produced over a given period; it's expressed as a comparison to the previous year/quarter.

Calculation of GDP could be done in three ways: output (production approach), adding up the year/quarter income (income approach), or adding up costs (expenditure approach).

The GDP in India expanded 1.40% in Q2 2016 over the previous quarter; the GDP growth rate averaged 1.67% in 1996-2016.

It reached a record high of 5.8% in Q2 2009 and all-time low of -1.8% in Q1 2009.

The GDP Annual Growth Rate reached an all-time high of 11.40% in 2010 and a record low of -5.20% in 1979-80.

US-based Fitch Ratings lowered India's GDP outlook for FY17 to 6.9% from 7.5% estimated previously.

In its Global Economic Outlook report, Fitch said the reason for the estimate is the cash-crunch created post-demonetization.

The impact on the growth of GDP would increase the longer the disruption continues.

The report said the real GDP growth forecast for the financial year ending in Mar'17 was revised.

Due to the demonetization, Indians haven't had enough cash to complete purchases.

There were reports of supply chains being disrupted and farmers unable to buy seeds and fertilizers for the sowing season.

Fitch stated: "Time spent queuing in banks is also likely to have affected general productivity."

It added growth would accelerate to 8% by 2018-19; in Oct'16, Fitch had forecast 7.4% for FY17.

Agriculture is a significant contributor to GDP growth; India suffered two consecutive years of drought coupled with farmers' suicides that led to a sharp decline in agricultural output.

Possible reasons include the demonetization, India's slow investment recovery, and global economies taking a hit due to the Brexit vote among others.

Indian economy had reportedly not shown signs of improved exports or capital expenditure.

The GDP of Q2 FY16-17 grew at 7.3% at constant prices (2011-12).

The sectors which showed maximum growth are 'Public Administration, Defence & Other Services', financial services, real estate, manufacturing amongst others.

Agriculture sector grew at a slower rate of 3.3% whereas mining saw a decline of 1.5%.

The government has also notified that inflation of food-articles stood at 9% for the previous quarter.

India's third quarter GDP grew at a faster-than-expected 7% pace despite demonetization in the quarter till December. It had been expected to grow 6.1% then.

This data, issued by the Centre Statistics Office, is surprising because it involves the period that saw the invalidation of high-value banknotes in November.

IMF said India's economic growth is expected to be 6% between October-March of 2016-17.