Is India's Growth Story Over?

Bangalore: India is facing a problematic situation as the fiscal and trade deficits are soaring high, the value of rupee is going down, investments are high but consumptions are low and above all the government is hesitant to reform their policies. All of these create a question in our minds that “Is India’s growth story over?”

The economy has declined and recorded its slowest growth in the nine years at 5.3 percent, in the last quarter of 2011-12. This sharp slowdown wasn’t anticipated but there were indicators to point out the downturn in the previous quarters as the economists had put up a consensus estimate of 6.1 percent for the quarter. In 2003 the quarterly expansion of the economy was lower than this quarterly at 3.6 percent.

The value of rupee is tumbling record low to the dollar, the Sensex has slid, and the petrol prices have gone up.  The government needs to pump up the economy by inducing stimulus measures that was done during the global economic crisis in 2008. The manufacturing shrunk 0.3 percent in the first quarter of the year while the farm sector grew by 1.7 percent. The service sector grew by 7.9 percent, retail sales grew by 7 percent which is much lesser as compared to the 2011 estimates.