Brace for slowdown

RBI surveys point to fragile growth momentum

The Reserve Bank of India’s surveys of consumer and producer confidence suggest that optimism about the Indian economy is coming off earlier highs. This suggests that the growth momentum may be slowing. The reasons for this loss of momentum might be several. For one, higher costs are spreading through the economy as a result of rupee depreciation, import tariffs and a tighter supply side. In addition, more recently, financial constraints have begun to be a major choke point. While bank credit growth has long been relatively slow, for some time non-banking financial companies (NBFCs) were picking up the slack. But