Economic growth slows in India

December 1, 2011 · Posted in Uncategorized 

Linda Young – AHN News Writer

Mumbai, India (AHN) – Economic growth in India slowed during the third quarter falling to 6.9 percent from 7.7 percent for the previous quarter.

It was the first time that gross domestic product has fallen below 7 percent in more than two years.

Declines in manufacturing and mining were blamed for slowing growth in India’s GDP.

That drop in GDP has put pressure on India’s central bank to end 18 months of fighting inflation. The bank has increased interest rates 13 times since March 2010 in an effort to bring inflation under control.

However, the hikes in interest rates are being blamed for stifling industrial expansion because of a sharp drop in domestic demand.

Manufacturing, which contributes 16 percent to the nation’s GDP, grew only 2.7 percent in the third quarter compared to 7.2 percent the previous quarter and 7.8 percent during the third quarter of 2010.

India is Asia’s third largest economy.



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