The World Bank in its report named Global Economic Prospects released on 12 June 2012, projected Indian economy to grow by 6.9% in the financial year 2012-13. The World Bank report predicted India’s growth increasing to 6.9 per cent, 7.2 per cent and 7.4 per cent in fiscal years 2012-13, 2013-14 and 2014-15, respectively.
Blaming fragile monetary policy, long paused reforms, persistent inflation and widening fiscal deficit for the country’s poor growth in 2011, the multi-lateral agency advised India to take some corrective measures to improve the sinking growth. Indian economy grew by 6.5 per cent in 2011-12, the lowest in the past nine years. The economy had registered an impressive 8.4 per cent growth in the previous two years.
The Indian government had projected the economy to grow at 7.6 per cent in the fiscal year 2012-13, but given the prevailing economic and political situations in the country, the projected growth rate could be hard to achieve.
The World Bank report estimated the global economy to expand 2.5% in the fiscal year 2012-13. The multi-lateral agency also cautioned the developing nations of the bumpy ride ahead.