Indian Economy Slumps To 6-year Low

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The Indian economy grew at its slowest pace in over six years in the April-June quarter owing to weak consumption demand and investment, official data showed on Friday.

The news has put added pressure on the government of Prime Minister Narendra Modi to expedite stimulus measures to reverse the slowdown.

For the first quarter of the fiscal year that began in April, government estimates showed that gross domestic product expanded 5.0% on the year, down from the 5.8% recorded in the January-March period.

The median forecast polled by Reuters was for a 5.7% expansion. It also means that India lost its status as the fastest-growing major economy for the second consecutive quarter as neighboring China grew 6.2% in the April-June quarter.

The slowdown comes amid distress in sectors ranging from non-banking finance to automobile and real estate. Escalating U.S.-China trade tensions are also being blamed for the slump.

Corporate earnings also fell sharply in the same quarter, marking their first double-digit drop in combined net profit in two years.

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