The turnaround of the Indian economy is still far away, said industry chamber, Assocham, in its response to the decline in GDP growth to below 5 per cent for the fourth quarter of fiscal 2012-13.
In a statement here on Friday, the Associated Chambers of Commerce and industry called for “drastic measures from the Government and the Reserve Bank of India.
“While the agriculture sector is expected to change for the better due to forecast of normal monsoon, several other key segments of the economy such as manufacturing, construction, mining remain in a slippery zone in the face of receding consumer confidence and high inflation coupled with a deadly dose of high interest rates,” said Rajkumar Dhoot, President of the chamber.
He said the biggest worry was on account of rupee which may slip further in case the foreign institutional investors get a cue from the GDP numbers for fiscal 2012-13 released on Friday.
“Not very sure how long the party in the equity market induced largely by printing of notes by central banks in the rich countries will last, that calls for pulling the socks in our domestic market which needs to be revived along with consumer confidence,” Dhoot added.
He said the RBI must further reduce interest rates while the Finance Ministry should allow the budgeted expenditure to be allocated and spent. “Government expenditure, when consumer confidence is low, can only revive the sentiment along with procedural clearances to some of the big ticket projects in the infrastructure sector,” he said.