India faces dampened demand, stagnant lending, slowing growth

Mumbai

CONSUMPTION was India's big story. Its 1.3 billion population was expected to guzzle everything from iron to iPhones, driving global growth and cheering investors such as Apple Inc and Goldman Sachs Group Inc.

For a while, everything seemed smooth. Indians were the world's most confident consumers, and the US$2 trillion economy was the fastest-growing big market. Then, last November, Prime Minister Narendra Modi took away almost all their cash, worsening a slowdown that had started earlier in the year. Climbing global oil prices and a tightening US Federal Reserve could also complicate domestic policy making.