InvestorQ : Is it true that Indian economy is in the midst of a slowdown and what does that really mean?
Arti Chavan made post

Is it true that Indian economy is in the midst of a slowdown and what does that really mean?

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Crowny Pinto answered.
2 years ago
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Indian economy is growing at 5% so the economy is not showing any signs of de-growth. But, the signs of a slowdown are surely there. If you look at the June quarter GDP came in at just 5%, and at that point of time policymakers refused to acknowledge an economic slowdown. It must be said that India is fortunate to be just at the start of the slowdown cycle and needs to act fast.

If you look around, and read the data, the signs of a slowdown are literally everywhere. Take some examples, Auto sales are down 30% on a YOY basis and auto companies are cutting down on production days to balance demand. Another signal of a slowdown in the economy is the rising instances of defaults in loan repayments, which is clear lead indicator of economic slowdown. Look at the financial sector defaults. We had IL&FS, Dewan Housing, Cox & Kings, Suzlon, Jet Airways RCOM and now Altico. Even the CFO of Parle warned about the layoffs of 8000-10,000 employees that may be required due to weak demand. Aviation growth is sharply down. If you look at the latest inflation numbers then the sharply lower rural inflation is clearly hinting at a rural slowdown.



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