India economy grows 5.3% in the first quarter of 2012, slowest pace in 9 years

India’s economy grew 5.3 percent year-on-year in the first quarter, the slowest pace in nine years, as the country’s manufacturing sector contracted, agriculture slowed sharply and consumers tightened their belts in the face of stubbornly high inflation.

According to Reuters, India grew 9.2 percent in the last quarter of 2011.

"It's beyond anything that we would have imagined," Samiran Chakraborty, head of research at Standard Chartered in Mumbai, was quoted by the Associated Press as saying.

"It looks to me that the consumption side of the story is now faltering."

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CNN Money quoted Indian Finance Minister Shri Pranab Mukherjee as saying the data was "disappointing," but it needed to be seen in the “light of overall global developments."

Asia’s third-largest economy grew 6.5 percent in the financial year ending March 31, which was the slowest paced since 2003, Xinhua news agency reported.

"This is the lowest in the contemporary period. It has been substantially down because of the very poor performance of manufacturing sector," Mukherjee told reporters.

India’s manufacturing industry shrank 0.3 percent in the first quarter from a year earlier, the Wall Street Journal said, citing government data.

The agriculture sector, a key employer in India, expanded by 1.7 percent compared with 7.5 percent a year ago.

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