The Straits Times
Published on Feb 07, 2013

India sees worse than expected economic slowdown in 2012/2013


NEW DELHI (REUTERS) - India's slowest growth in a decade could be worse than anticipated, as preliminary data released on Thursday showed the economy set to have grown 5.0 per cent in fiscal year ending next month, underscoring the urgent need for reforms to boost growth.

The central bank's forecast for the year had been 5.5 per cent, while Finance Minister P. Chidambaram had projected growth of 5.9 per cent, but both appear to have been over-optimisic.

"Five per cent GDP growth for the full year is more in tune with reality. The industrial sector downturn has extended beyond anyone's expectation," said Mr Rupa Rege Nitsure, chief economist, Bank of Baroda, Mumbai.

The data will pile pressure on Prime Minister Manmohan Singh's Congress-led government to unveil a growth-oriented budget on Feb 28 for the next fiscal year, beginning in April.