Macroeconomic situation is worsening, says Assocham

India may not be heading towards a balance of payment crisis, but its macro-economic situation is worsening by the day, calling for urgent steps to ensure no further damage is done to the economy, a survey of leading economists and select industry leaders has pointed out.

Of the 58 economists and CEOs covered by the Assocham poll in the last week, as many as 53 said India's macro-economic situation has suddenly worsened.

“India may not yet be heading towards a balance of payment crisis, but the macro-economic situation is worsening by the day, calling for almost emergent steps to ensure that no further damage is done to the economy,” Assocham said.

Policy flip-flops

It was a combination of flip-flop on domestic policies and the global uncertainties arising mainly from the troubled Euro zone that played a spoilsport for the Indian economy, it said.

“The breaking out of scams, one after the other, resorting to taxation policies perceived as unfriendly to global investors, and the government's political compulsions in not pursuing economic reforms are major factors that have led to a worrying state of the economy, which was booming till two years ago,” it said.

The majority of the respondents said India's macro-economic situation has suddenly worsened. “The worst disaster is coming from a huge uncertainty on the rupee value and its free fall. Everybody out there in the business world is feeling shaky,” the survey said.

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