The Indian Economy Is A Wreck: These Charts Show What's Going Wrong

Sunny Jun 3, 2012

India's economy grew just 5.3 percent the past quarter, the rupee is taking a beating, and inflation is still high, leaving the central bank with little room to maneuver.

We've written about India's fiscal problems, but what's behind the slowdown?

Drawing on a report by HDFC Securities' analysts Sameer Narang and Vishal Modi we pulled together 8 charts to show the deceleration in the Indian economy.

India's GDP grew 5.3 percent in the fourth quarter falling to a seven-year low

CSO / HDFC Bank

And the slowdown has been sharp in the last four quarters, with GDP slowing from 8 percent in June 2011 to 5.3 percent the last quarter

CSO / HDFC Bank

HDFC has revised down their 2012 growth rate for India to 6.5 percent driven by lower growth in industrial output and the service sector

CSO / HDFC Bank

Agriculture which accounts for about 16 percent of GDP has also slowed down

CSO / HDFC Bank

Services slowed to 7.9 percent in the fourth quarter led by slowdown in trade, hotels, transport and communication sub-sector

CSO / HDFC Bank

Given high interest rates and weak external and internal demand industrial production is expected to stay soft

CSO / HDFC Bank

Manufacturing plunged to 2.5 year-over-year (YoY) growth in FY12, down from 7.6 percent the previous year. It is projected to grow 3 percent in FY13

CSO / HDFC Bank

Investment rate for 4QFY12 improved to 31.4 percent of GDP from a low of 27.8 percent of GDP in 3QFY12

CSO / HDFC Bank

GFCF or gross fixed capital formation is a component of the expenditure on GDP and shows how much of the new value added in the economy is invested (rather than consumed).

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