HINDUSTAN TIMES, FIRST POST, THE TIMES OF INDIA (India), BBC (UK)
NEW DELHI- India reported its slowest growth in nearly a decade Friday, as Asia’s third- largest economy remains mired in an economic slump. GDP growth fell to 5.3% during the third quarter of 2012, down from 5.5% in the previous quarter.
Before the figures were released, Finance Minister, P. Chidambaram, said that the economy must overcome the economic slowdown through innovation and increasing the production of goods and services, The Times of India reports.
Photo: P. Chidambaram - via Wikipedia
A growth rate below 6% for the third successive quarter is damaging for a country that aspires to near double-digit expansion in order to provide jobs for its expanding population. The slump also makes it more difficult for Prime Minister Manmohan Singh to fund flagship welfare programs ahead of a national election due in mid-2014, writes the Hindustan Times.
According to the BBC, calls to lower the borrowing costs have so far been avoided by the Reserve Bank of India (RBI), which is focused on keeping inflation under control.
Hindustan Times noted that the latest numbers come on the heels of a report released by Goldman Sachs on Thursday, stating that India’s economy will grow by 6.5% in 2013, and gather pace over the next two years. However, the near-term outlook remains "difficult" due to still weak growth, high inflation, and the twin deficits, Goldman Sachs said, adding quick upturn in the investment cycle is "unlikely".
The growth in construction was the highest (6.7%), followed by trade, hotels, transport and communications says First Post, and the lowest were electricity, gas and water supply. The news portal also reports that Chakravarthi Rangarajan, chairman of the Prime Minister’s economic advisory council, expects that the final quarter of the year will rise to 5.5% again.