IMF revises down India's GDP forecast to 7.5% for '12

The Indian economy would grow by 7.8% in 2011 and by an even slower 7.5% next year, the International Monetary Fund (IMF) said on Thursday, citing less-than-anticipated recovery in advanced economies and the uncertain global outlook.

The Indian economy would grow by 7.8% in 2011 and by an even slower 7.5% next year, the International Monetary Fund (IMF) said on Thursday, citing less-than-anticipated recovery in advanced economies and the uncertain global outlook.

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"In India, where corporate funding relies increasingly on external commercial borrowing and equity finance, a severe fall in investment would severely curtail growth," the IMF said in its latest regional economic outlook.

The Indian economy grew by 8.5% in 2010-11 but moderated to 7.7% during April-June, the slowest in 18 months, mirroring signs of a slowdown.

Private consumption remained robust in India due to rising disposable income, but investment was subdued partly on concerns over governance and the global outlook, it said.

Growth in Asia has also moderated since the second quarter of 2011, mainly as a result of weakening external demand, the fund said.