Lack of investor confidence, turbulent global economic conditions, domestic policy slow down coupled with 20 per cent deficient monsoon will lead the Indian economy to grow barely at 5.5 per cent, global consultancy firm Moody’s Analytics said on Thursday.
“India’s gross domestic product (GDP) growth rate is likely to be 5.5 per cent this year while in 2013 growth is expected to be 6 per cent adjusted from 6.2 per cent earlier,” it said.
“There has been little policy response from either the Reserve Bank of India or the government and with global uncertainty dragging on. We see nothing on the horizon to lift the economy from its funk,” Moody’ s Analytics senior economist Glenn Levine said.
Moreover the poor June-to-September monsoon which accounts for around 60 per cent of annual rainfall is the second major factor behind the slowdown in growth forecast.
“The monsoon is running 20 per cent below long-term averages and this might cut agriculture output and rural incomes with knock-on effects for consumer demand and food prices which will reaccelerate from early 2013 the Moody’ s report said in its forecast for the Indian economy.