HSBC survey said economic growth in emerging market economies slowed in the July-September quarter on poor performance by the manufacturing sector, but India expanded more than China.

The HSBC Emerging Markets Index EMI slipped to 52.1 in the third quarter this year, from 53.2 in the April-June period. A relatively better performance from the services sector was offset by the poor performance of the manufacturing sector, as global demand softened.

However, among the big-four emerging markets, expansion in India and Russia was better than Brazil and China, HSBC said.

HSBC's chief economist Murat Ulgen said emerging economies are being impacted by the misery of the developed world as the deteriorating global trade cycle, weaker external demand and falling new export orders hit manufacturing output and the services outlook.

 RBI today released its annual report for 2011-12 fiscal that ended on June 30. Attributing economic slowdown to a combination of domestic and global factors, the report says that the investment climate has worsened due to structural impediments, policy uncertainties, inflation persistence and rising interest rates.

To reverse the trend, RBI has asked the government to fast-track infrastructure projects and speed up regulatory clearances that will help to boost investments. RBI has said that investment climate in power sector has been affected by State Electricity Board losses and coal supply shortages. It advises the government to resolve all pending issues in respect of proposed new Fuel Supply agreements and resolve coal block auction without any further delay.

In the report RBI has said in order to step up public capital expenditures, the government needs to cut expenditure on subsidies. It adds that with limited fiscal and monetary space available to provide a direct stimulus, an expenditure-switching policy is needed.

RBI has said that financial inclusion is a substantially unfinished agenda and efforts need to be upscaled to reach out with a human face. RBI has also advised corporates to maintain integrity and be more competitive.
Defending its tight monetary policy stance, RBI said that although it has contributed to growth deceleration but was essential to maintain price stability and to lower inflation.

 The Prime Minister Dr. Manmohan Singh has said, the present slowdown was not inevitable or irreversible. Addressing Convocation ceremony at IIT Bombay, Dr. Singh said, after half a century of zero rate of economic growth, from 1900 to 1950, India managed to register 3.5 per cent growth for three decades after Independence, from 1950 to 1980. But from 1980 to now, over the subsequent three decades, the country nearly doubled that rate of growth.

He said, the fundamentals of our economy are sound and with greater effort being made to mobilise all the latent physical and human resources, we can go back to the growth rate of 8 to 9 per cent per annum achieved from 2003 to 2008. Dr. Singh said, the large investments in the development of human resources that we have made in the last eight years would facilitate that outcome.

Amid economic slowdown, Bihar economy grew at a rate of 16.71 per cent in comparison to its performance in the previous fiscal. The agriculture sector registered a growth of 17.16 per cent the highest in the past five years. The quick estimates of growth rate of gross state domestic product (GSDP) on constant prices for 2011-12 has turned out to be the best in the past five years. 

In Patna Deputy Chief Minister Shushil Kumar Modi said the food grain production in year 2011-12 jumped to 169.69 lakh metric tonnes from 103.47 lakh metric tonnes a year earlier. Rice production contributed the most from 31.02 lakh metric tonnes in 2010-11, it jumped to 83.05 lakh metric tonnes in year 2011-12.

In a press conference Modi also said that government will expend 1 Lakh 50 thousand crore rupees for next five year in agriculture sector. Government targeted 13 per cent estimate growth rate in 12th five year plan in state economy with the support of 7 per cent estimated growth in agriculture sector, said Modi.

Reacting to US President Barack Obama's assertion(ddava) that the government must carry out "difficult" economic reforms, India Inc said India remains a strong investment destination with strong long-term growth prospects.

Acknowledging that the nation lagged in reforms in sectors like retail, aviation, defence and insurance, India Inc said Obama or any other person cannot be dictating Indian government or Indian policy makers.

Industry chamber Assocham Secretary General D S Rawat said. US has also had lot of limitations like the recent
restrictions imposed on BPOs But Indian economy is till doing much better than most of the developed countries.

CII Director General Chandrajit Banerjee said India was resilient and was still growing at 6 per cent during the time of global economic uncertainties. FICCI Secretary General Rajiv Kumar said India's long-term growth remains strong and intact.

The United Nations has said that Indian economy will grow at a slower pace of 6.7 per cent in 2012 instead of a previous 7.7 per cent forecast. In its World Economic Situation and Prospects mid-year update, the UN warned that the euro area debt crisis will remain the biggest threat to world economy this year. It said, the global economic situation continues to be challenging and global growth will likely remain tepid in 2012 following a marked slowdown in 2011. The report said, the global economy is projected to grow by 2.5 per cent in 2012 and 3.1 per cent in 2013, following a growth of 2.7 per cent in 2011, a slight downward revision from previous forecasts. It said, an escalation of the euro area debt crisis could result in severe turmoil in financial markets and a sharp rise in global risk aversion, leading to a further weakening of global growth. The UN report said, most regions of the world will also be expanding at a pace below potential. Economic growth in South Asia is projected to moderate to 5.6 per cent in 2012, down from 6.1 per cent in 2011 as the region continues to face significant regional and global headwinds. Weak demand in developed countries and a slowing Chinese economy are likely to weigh on economic growth in East Asia. Average regional growth is projected to slow from 7.1 per cent in 2011 to 6.5 per cent in 2012. Growth in China is forecast to slow from 9.2 per cent in 2011 to 8.3 per cent in 2012.

The statement on quarterly review of the trends and receipts and expenditure in relation to the Budget at the end of third quarter of 2011-12 was tabled by Finance Minister Pranab Mukherjee in Parliament today. The statement said, uncertainties prevailing in the global economy at the time of presenting the Budget for 2011-12 turned out to be on the negative side and has impacted growth performance of the economy .

This, coupled with prevailing high international crude prices, has resulted in higher expenditure on subsidies for petroleum and fertilizer products. Also moderation in growth has impacted direct tax revenue receipts.

The volatility in capital market has resulted in recalibration of government's disinvestment strategy. The statement said, all these factors have a combined impact of deterioration in fiscal performance when compared to the Budget estimates 2011-12.

Accordingly, the fiscal deficit and revenue deficit estimates have been revised as 5.9 per cent and 4.4 per cent of Gross Domestic Products respectively in the revised estimates for 2011-12.

The International Monetary Fund lowers India's growth forecast to 6.9% for this year,IMF's Asia-Pacific Regional Economic Outlook released today said . The lowered growth outlook in 2012 owes much to a slowdown of investment which partly reflects structural factors IMF called for renewed efforts to revive the flagging structural reform agenda. It also pointed out that domestic factors too have played a role in India's growth slowdown over the second half of 2011. However, the multilateral agency has retained India's growth estimate at 7.3 per cent for 2013. As per the IMF, the national economy grew by 7.1 per cent last year. IMF also called for steps to improve investment climate, remove infrastructure bottlenecks and expand education opportunities, thereby boosting reforms. On price rise, the multilateral agency stressed that fiscal consolidation is the key to containing inflationary pressures and creating space for priority development needs. The IMF in its Asia-Pacific Regional Economic Outlook report added that Asian economies, led by India and China, are expected to see better growth this year but any escalation of European debt turmoil will impact them, It said emerging Asia would remain the fastest growing region in the world. Emphasising that economic re balancing remains a policy priority for much of Asia, the IMF said the best way for the region to protect itself against external shocks is by strengthening domestic sources of growth.

Commerce Minister Anand Sharma today said, the BRICS, economies comprising Brazil, Russia, India, China and South Africa have an important role to play in defining the changing global financial architecture.

Mr. Sharma said this while addressing the inaugural session of the BRICS Business Forum in New Delhi this morning.

He said, the BRICS countries are the engines of growth assisting the global economic recovery, and they should jointly work towards their concerns being heard in the international fore.

Mr. Sharma said, the coming together of the five countries have attracted global attention as they have tremendous potential for collective economic prosperity.

He called upon the BRICS nations to deepen and diversify the economic partnership to benefit their own people and also to contribute towards faster global economic recovery.

He said, the member nations have to set priorities and targets while ensuring free flow of capital, exchange of technology and to create a common platform for enhanced trade and commerce.

He said, India is back on the path of achieving higher economic growth rate though it was recently impacted by low demand in the US, Europe and Japan. He said, high international oil prices, import of gold also put the current Account deficit position under duress. 

Speaking on the occasion the Chinese Commerce minister, Chen Deming said, his country expects to clock 7.5 per cent growth even though a slow down was experienced.

Russia's Economic minister Ms. Elvira Nabiullina said, Russia though not a developing country registered 4.3 per cent growth and hopes to regain the growth rate of pre crisis levels. She also favored exchanges of national currency denominations between the BRICS nations for trade. 

The South African Trade Minister Rob Davis said, his country's economy is closely interlinked with the African continent that has clocked 5.5 per cent growth. He said, Africa has opened up as land of tremendous opportunities for Industrialisation.

He said, a 29 percent increase was observed in trade with BRICS nations. Industry minister of Brazil Fernando Pimentel Brazil said, his country looks forward to enhanced economic activity between the BRICS countries