India Growth Seen Below 5% for Longest Spell Since 2005: Economy – Bloomberg 11-26-13

Salient to Investors:

Goldman Sachs expects the Reserve Bank of India to raise the policy interest rate to 8.5 percent in 2014 from 7.75 percent.

Radhika Rao at DBS Bank said Indian growth will remain in low gear, with the odds of expenditure restraint high given India has to prevent a credit-rating downgrade that would disrupt foreign investment. Rao said a reform-minded administration must emerge from general elections due by May for expansion to exceed 5 percent in the year ending March 2015.

Yes Bank said Finance Minister Chidambaram will reduce planned outlays on items such as roads, ports and welfare programs by $11 billion this fiscal year. Shubhada Rao at Yes Bank said farm and industrial production will help the growth recovery in the second half of the fiscal year.

825 million Indians live on under $2 per day.

Dharmakirti Joshi at Crisil said an investment cycle requires certainty and that won’t happen until after the elections.

Read the full article at http://www.bloomberg.com/news/2013-11-25/india-growth-seen-stuck-below-5-for-longest-stretch-since-2005.html

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