Global financial services firm Nomura has sharply lowered India's growth forecast for this fiscal to 5.8 per cent, way below the government's projection, saying the country's monetary and fiscal policies are at loggerheads.
"With monetary and fiscal policies at loggerheads, we lower our growth projections...Given weaker initial conditions and limited scope for a major stimulus, we revise down our GDP growth forecast to 5.8 per cent for FY13...," it said in a report.
It has also cut its India GDP forecast for 2013-14 to 6.6 per cent form the earlier 6.9 per cent.
The government is aiming at GDP growth rate of about 7.6 per cent this fiscal. India's economic growth rate slowed to 6.5 per cent in 2011-12 from 8.4 per cent in the previous two fiscals.
Amid GDP slowdown, rupee depreciation and warnings from rating agencies, market still harbour hope that that a new finance minister will redirect the economy towards reforms after the presidential election.
Nomura pointed out that in light of the government's failure to take steps to boost the supply side and rein-in
From FM to President: Pranab's successful innings
Will RBI chief Subbarao be the next FM?
IMAGES: 10 Indians among hottest business leaders
'Your birthplace, background don't determine your success'
OMOs aid govt borrowing as RBI fights rupee slide