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Rediff.com  » Business » BAD NEWS! India's economy to grow a mere 7.7% only
This article was first published 12 years ago

BAD NEWS! India's economy to grow a mere 7.7% only

Last updated on: January 17, 2012 17:33 IST

Image: Railway workers push a wagon loaded with coal.
Photographs: Reuters.

India's economic growth rate will remain subdued at 7.7 per cent in 2012 and 7.9 per cent in 2013 as downside risks have increased, mainly on account of problems in Europe and the USA, says a UN report.

For Rediff Realtime News On India Growth Story, . . .

BAD NEWS! India's economy to grow a mere 7.7% only

Image: Indian currency notes are stapled to form a garland at a shop in Jammu.
Photographs: Mukesh Gupta/Reuters

The report cautioned, "The downside risks to the regional outlook have sharply increased in recent months. . . particularly in case of India. Double-dip recessions in Europe and the United States would have a significant impact on economic activities across South Asia."

The government recently lowered the GDP growth target for the current fiscal to 7 per cent from the earlier estimate of 8.5 per cent.

. . .

BAD NEWS! India's economy to grow a mere 7.7% only

Image: A labourer works on reinforcing bars at a construction site to build a bridge.
Photographs: Amit Dave/Reuters

However, the study gave a positive outlook on South Asia's economic growth prospects and projected that the region's economies will grow by 6.7 per cent and 6.9 per cent

in 2012 and 2013, respectively, accelerating beyond the 6.5 per cent growth rate experienced in 2011.

South Asia constitutes India, Pakistan, Nepal, Iran, Bangladesh and Sri Lanka.

. . .

BAD NEWS! India's economy to grow a mere 7.7% only

Image: Farmers at work.

The report also raised a red flag on India's fiscal deficit target, saying the Indian government is unlikely to achieve its deficit target of 4.7 per cent of the GDP for 2011-12 as lower growth has brought down tax revenues and disinvestment in state-run companies has been put on hold.

Nevertheless, the study has given a positive outlook for India's job market, saying, "India is enjoying gains in employment rates."

 

Tags: India , GDP
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