Fiscal deficit, bad loans at banks reveal fragile side of Indian economy

Mumbai

NEARLY eight months after Narendra Modi was swept into power in May 2014, the Indian economy has had a mixed showing. Figures released last week by the Ministry of Statistics and Programme Implementation show that growth in industrial production reached a five-month high of 3.8 per cent in November after contracting 4.2 per cent in October. However, consumer durables continued to be hit by low demand.

The official figures also show that consumer price inflation rose to 5 per cent in December from 4.38 per cent in the previous month, primarily due to a rise in food prices. This is still lower than inflation a year ago and close to the level the country's central bank requires for a rate cut.