The government on Wednesday lowered the full-year economic growth forecast to 7.3% from 9%, as industrial slowdown hit India's gross domestic product (GDP) in the second quarter ( July to September).
The growth rate in GDP — the value of all goods and services produced in a country during a specific period — fell to 6.9% from 8.4% in the corresponding quarter previous year.
Finance minister Pranab Mukherjee said, "Taking into account (the trend) of the last two quarters together, it appears that the GDP growth would be around 7.3%."The manufacturing sector, which accounts for about 17% of GDP, grew by a sluggish 2.7%.
Also, eight core sectors — power, coal, crude oil, refinery products, natural gas, fertilisers, steel and cement — grew by a flat 0.1% in October against 2.3% in September, mirroring a slowdown in investment activity.
Slower industrial growth could hit jobs and salaries as firms, squeezed in by lower sales, hold back investment.