As per the report from the Credit rating agency Crisil, GDP growth is estimated to be lowered to 7.6 per cent for the Fiscal Year 2012 from the previous forecast of 7.7 to 8.0 per cent. Crisil has downgraded the GDP growth for the second time. In 2010, it has been estimated that the GDP growth would be at 8.5 per cent for 2011 – 2012. But this forecast was lowered during May, 2011 to 7.7 – 8.0 per cent.
According to Ms. Roopa Kuduva, Managing Director and Chief Executive officer of Crisil, the impact of interest hikes, reduced Government expenditure and slowdown of advanced global economies had been more than anticipated. This in turn led to the weak investment environment and thus it has been projected that the GDP growth would be at 7.6 per cent
The report has also projected the industrial activity to grow at a slow rate of 6.5 per cent in 2011- 2012 which was previously estimated to be at 7.3 per cent. Most of the sectors such as consumer durables, automobiles and construction have been negatively brunt by the tightening Monetary Policies.
The inflation rate based on Wholesale Price (WPI) has been projected to increase to 9.1 per cent from 8 – 8.5 per cent.