Attributing slowdown to global factors, Chief Economic Adviser Kaushik Basu today said economic growth in the current fiscal could be around 7-7.5%, down from 8.5% a year ago.
"What looked like a 9% growth year, now we are projecting somewhere between 7% and 7.5%," Basu said while addressing an event of Global Development Network.
Indian economy registered a growth of 7.3% in the first half of the current fiscal.
The economy grew by 8.5% in 2010-11.
As per the Reserve Bank of India's projection, the growth rate in the current fiscal would slow down to 7.6% from earlier projection of 8%.
"When we began our Budget exercise in January 2010, we thought we will grow by 9% [2011-12]. But oil prices went up from $90 to $110 and not really coming down the way we were expecting," he said.
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"A bit of this to my mind is to do with major change in global scenario...What is happening in the world you get one crisis after another. 2008 and now we are standing on the brink of another one 2012," he said.
"Europe began to be tottering on the brink of crisis. Over the last two months our exports have begun doing badly and over the year we are seeing directly it is the international demand which is tanking and beginning to affect us," he said.
With Germany's growth figure being downgraded, he said, "we are really worried about Europe. Whether Europe is going to go into negative growth".
Two quarters of negative growth will be officially described as recession, he added.