The growth collapse

Global factors do not fully explain the slowdown

There was a near consensus on the direction, but the magnitude of the deceleration in growth surprised most analysts. The Indian economy in the first quarter of the current fiscal year grew at 5 per cent, compared to 5.8 per cent in the previous quarter and 8 per cent in the same quarter last year. While growth in the manufacturing sector slowed to a dismal 0.6 per cent, expansion in agriculture slipped to 2 per cent, compared to 5.1 per cent last year.

The latest data should worry Indian policymakers because it is now absolutely clear that problems in the economy