August 10th, 2011
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Asian tigers to slow down

asian tigerIndia and China are likely to see economic slowdown in the coming months and similar trends are expected for developed nations, including Germany and Italy, according to Paris-based think tank OECD.The grim reading for two of the world’s fastest growing economies — India and China — comes at a time when the global financial system is battling the fallout of the US credit rating downgrade as well as European debt crisis.

Organisation for Economic Cooperation and Development (OECD) is a grouping of mostly developed countries and the member nations account for over 60 per cent of global output.”The Composite Lead Indicators (CLIs) for Canada, France, Germany, Italy, the United Kingdom, Brazil, China and India continue pointing to slowdowns in economic activity,” OECD said on August 9.

The grouping’s latest assessment are based on CLIs for the month of June. CLIs provide early signals of turning points with regard to economic expansion and slowdown.India’s CLI declined to 96.1 in June from 97 in the previous month. The indicator for India has been marginally falling since November 2010.

Indian economy is expected to clock a growth of 8 per cent in 2011-12, much lower than the budgetary estimate of 9 per cent expansion.The country is also battling with high inflation, which has forced the Reserve Bank of India to hike key rates 11 times since March 2010. Headline inflation stood at 9.44 per cent in June.

According to global investment banking major Goldman Sachs, Indian economy is projected to expand 7.3 per cent in the current fiscal, slightly lower than the earlier estimate of 7.5 per cent growth.

 



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