Indian economic growth slows

02 March 2009

NEW DELHI: The Indian economy grew by just 5.3% in the last quarter according to the country's Central Statistical Organisation, down from 7.6% in the previous three months, and the slowest rate of expansion since 2003.

While the country's economy has grown at an average rate of around 9% in each of the last three years, this has slowed to 6.9% over the last nine months, slightly below the 7% target the government has set for the next fiscal year.

Among the main reasons for this trend in the last quarter were declines in agricultural and manufacturing output, and a 6.9% contraction in the construction industry year-on-year.

While sectors including communications and financial services posted growth, it was "community, social and personal services", mainly taking the form of government spending, which increased at the highest rate on the year-ago period, up by 17.3%.

D.K. Joshi, an economist with Credit Rating Information Services, said all sectors of the economy have "shown weakness" in recent times, but also predicted growth of "closer to 6.5%" to the end of the fiscal year.

Data sourced from Times of India; additional content by WARC staff