New Delhi - A sharp slowdown in the Indian economy was evident Friday when official data showed growth at 5.3 per cent in the October-to-December quarter, the slowest quarterly growth in almost six years.

The figure was a substantial decrease from the 8.9-per-cent expansion recorded in the same period the previous year as the global economic crisis cut demand and exports.

There was no plan to waive loans of the landless, said the Government on Thursday.

But at the same time, the Govt said that schemes are in place to assist them get out of the grips of loaners.

While answering to a supplementary during Question Hour in the Rajya Sabha, Mr. Pawan Kumar Bansal, Minister of State for Finance, stated that there was no plan to waive loans of the landless.

There are several schemes for them, he said.

Indian Banks Association ordered its associates to offer loans to the landless in order that they can pay off the money-lenders, the Minister said.

Mr. Bansal also said that the administration has been receiving demand for lifting the 5-acre limit for farmers’ debt waiver plan.

The employees of central government have yet another reason to cheer as the Union Government has announced to hike the dearness allowance of employees and pensioners by 6 percent from existing 16 per cent to 22 per cent with immediate effect.

The new DA rates would be applicable from January 1, 2009 according to Home Minister P Chidambaram, who was addressing a press conference after the cabinet meeting.

With the government cutting excise and sales tax, tyre-maker Ceat decided to cut prices with immediate effect, passing on the entire benefit of the 2% excise cut to consumers. 

The Steel Authority of India Ltd (SAIL), JSW Steel and Ispat Industries have also decided to cut prices. "The excise duty cut will result in a reduction in the range of Rs 500-600 per tonne," said SK Roongta, chairman of SAIL. Steel products are priced between Rs30,000 to Rs40,000 per tonne. Prices of bulk cement may fall by Rs5 per 50 kg. 

Credit rating agency Standard & Poor (S&P) maintained the current long-term sovereign rating of India at BBB- and the short-term rating at A-3, indicate there was still leeway for the government to work its way out of the fiscal mess.

"We think there's still a possibility that India can improve its fiscal position and avert a rating downgrade," S&P's credit analyst Takahira Ogawa told DNA. "If we didn't think so, we would have downgraded it right now."

But even as he said that, the Union government was announcing a Rs30,000 crore stimulus package involving a 2 per cent reduction in excise and service tax. This could fetch us a downgrade faster than anticipated.