Is India's Growth Story Over?

The inflation has averaged to 9 percent since past few years along with the retail lending rates which is between 12- 16 percent. Car sales have reduced by 2.19 percent and the big ticket sales have been worst hit. At this BimalJalan the former Governor of India’s Central Bank and also a respected economist said, “There's something happening that we are not quite in grips with so something needs to be done.”

He believes that deeper structural and systematic problem is wreaking the economy. He adds, “You can import as much oil as you want, you can pay for it because your reserves are high, and your exports are doing reasonably well even though they may not have done so well in one or two quarters. Your current account deficit is higher than you expected, but still we can afford it, there is no great problem. So what is it that's lacking and that we don't have?”

The Indian Prime Minister Manmohan Singh has blamed the factors such as Eurozone debt crisis for the economic woes. The Finance Minister Pranab Mukherjee says, “Among factors that contributed to the slowdown are a significant rise in the interest costs and weak global sentiments.” But many economists and investors blame the weak leadership and bewildered policies for the failure to put a cover on the government spending and which gives rise to alienation of many foreign investors.