Indian Economy Advances, but Slows from Earlier Pace

Posted August 30th, 2011 at 3:05 pm (UTC-5)
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India says its economy advanced 7.7 percent from April to June, its slowest growth rate in a year-and-a-half and an indication that the weakening global economy is affecting the country.

India has Asia's third largest economy behind China and Japan, and has enjoyed robust growth. But on Tuesday the Indian government said growth is slowing in the country's mining, manufacturing and construction sectors, which accounted for most of the reduced pace.

India said its economic growth was 8.8 percent in the same period a year ago.

The government has pushed to achieve double-digit growth rates. However, that effort has been partly stalled by the need to control rising consumer prices. India has raised benchmark interest rates 11 times in the last two years in an effort to curb the inflation rate that has hovered around 10 percent.

In addition, companies in Western industrialized countries — which have helped boost Indian growth — have trimmed new investments in the country as they face their own economic difficulties.