"When our growth declined to 5.5 per cent in the first quarter of this financial year, and when growth is likely to be around 5.5 per cent in the second quarter of this financial year, it goes without saying that we face a difficult situation," Chidambaram said.
The Central Statistical Organisation (CSO) is scheduled to release the GDP figures for second quarter on November 30.
Indian economy, which was growing at over 8 per cent before 2011-12, has slowed due to both global and domestic reasons. The growth in the first quarter of the fiscal was 5.5per cent, lowest in a decade.
Chidambaramfurther said that to overcome the difficult economic situation, there is a need to find innovative ways to increase output of goods and services.
"Wehave to overcome this difficult situation through innovation, through finding ways of increasing the production of goods and services," he said adding that finding new ways to help the poor depends on high economic growth both for jobs and income.
TheFinance Minister called upon the banks to play an active role in reviving the economy. "I genuinely and sincerely believe that banks represent the heart of the financial system and it is banks that will drive the revival of India's economy and putting India's economy on high growth path," the minister added.
The Reserve Bank has scaled down India's economic growth prospects for the fiscal to 5.8 per cent from 6.5per cent.