Pranab blames European crisis for industrial slump
15 Dec 2011
Finance minister Pranab Mukherjee today underlined for the umpteenth time that the slowdown in the Indian economy was largely due to international factors outside the government's control.
''We are passing through a difficult phase both locally and globally,'' he said at the Delhi Economics Conclave today, after data this week showed that growth in industrial production had shrunk by 5.1 per cent, in October, compared to 11.3 per cent growth in October last year.
Mukherjee said the government has limited options to combat the slowdown. ''The heart of the current crisis lies in the [European] sovereign debt crisis,''he said. ''Robust growth in emerging economies is beginning to falter.''
He said that major economies worldwide, particularly those in Europe, have not yet emerged from the slowdown in late 2008 despite the aggressive use of fiscal and monetary tools.
At the same time he insisted that India's banking sector is robust, despite worries in some quarters about non-performing assets.
India's GDP growth rate slowed to 6.9 per cent in the second quarter of 2011-12 from 8.4 per cent in the corresponding period of the previous year.
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