NEW DELHI: Banking player Citi and international brokerage CLSA have also lowered their projections for India's growth to 5.4% and 5.5%, respectively.
Citi said, “The stars just don’t seem to be aligning for India, with almost all the growth drivers being hit. The government needs to get down to serious business with more action to stem a further deceleration in growth.” It is cutting down its FY13 growth projection to 5.4% from the previous 6.4%.
The report by Citi India Chief Economist Rohini Malkani stated that if the drought conditions decline further, growth is expected to fall further to 4.9%.
CLSA also lowered its GDP growth projection to 5.5% as compared to the past 6%. The brokerage’s Senior Economist Rajeev Malik has claimed that this is not expected to be final revision since the monsoon is not yet over.
Last week, the Met department stated that the monsoons will stand below normal by 9-10% of the long period average.
During the quarterly policy review on July 31, the Reserve Bank of India (RBI) also lowered its growth projections to 6.5% from the earlier 7% due to high fiscal deficit, sticky inflation.