The global recession has already hit India in a bad way; latest GDP, IIP and export figures showed a marked slowdown in India’s economic growth and prospects. Indian bourses are among the worst hit in terms of loss of market capitalization; both the BSE and NSE saw their market cap fall by around 65 per cent by the end of the year 2008. The 3 stimulus packages dealt out so far will cost the govt in terms of piling fiscal deficit; global rating agency Standard & Poor’s (S&P) changed its outlook on India’s long-term sovereign credit rating from stable to negative, citing that India’s fiscal position has deteriorated to a level that is unsustainable in the medium term. However, we feel that if the growth rate comes back to the strong trend rate seen before the crisis, the fiscal deficit as percentage of GDP may not be at very damaging levels.
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for data on the Indian economy & Financial markets, India’s GDP growth projections and for details of the measures taken by the RBI and the Indian Government to manage the crisis and economic downturn..