India recoded 5.3 per cent growth rate, the lowest over the last five years, during October-December period of current financial year, reflecting grimmer situation ahead under the impact of global slowdown and recession across the world. The economy was growing at 8.9 per cent in the same quarter of 2007-08.

Government and the Reserve Bank have taken many fiscal measures to stimulate demand across various sectors of economy and announced special economic booster package to mitigate the impact of global slowdown on the economy. However, the results of these stimulus packages will take time to reflect results.

Country’s manufacturing growth declined to 0.2 per cent according to data released by the Central Statistical Organization (CSO) on Friday. Growth rate of agriculture sector declined to just 2.2 per cent despite loan waiver and other farm friendly policies by Union government.
 
Pronab Sen, India’s Chief Statistician, said, “What has come as a surprise is agriculture… but we can be optimistic that the figures will improve.” He said that country is unlikely to register GDP growth rate of 7.1 per cent for the financial year 2008-09 as projected by PM’s economic advisory council and other leading financial institutions.

However, government is optimistic for improvement in growth rate due to various steps taken by government to boost demand in the economy. Minister of State for Finance, P. K. Bansal asserted, “We had maintained seven per cent with a downward bias. That much has been said, but there is still a quarter to go. Even with 5.3 per cent, it still comes around seven per cent, maybe a shade below that”