“Under six.” Unthinkable a year ago, this is the muttered phrase on the lips of India’s business leaders these days: that the country could post gross domestic product growth of less than 6 per cent this fiscal year.
“It’s a crisis – we’re going to be looking at 5.5, but you wouldn’t know it from the way these guys are acting,” said the CEO of the Indian branch of one of the world’s largest Internet companies, referring to the central government; he would not speak on the record for fear of souring an already fraught relationship with that government.
In many of the world’s major economies, 5.5-per-cent growth sounds like a dream, but it’s barely half of what was predicted for India at the start of the fiscal year back in April.
The country needs the near-double-digit growth if the half of its citizens who continue to live in stark poverty are to get jobs and see change in their lives, and the Indian National Congress-led government needs to see it if they are to have any hope of winning re-election.
But a vicious mix of external and internal factors has combined to savage the prospects for this year, and there are signs the coming six months will be worse.
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