While slowdown is a global phenomenon, India has remained insulated from such events in the past due to its burgeoning consumer demand on the back of its demographic dividend, it said. The Indian economy was expected to grow at a much faster pace encouraging the nation to set a goal of a $5 trillion economy in the next five years thereby targeting a CAGR of 15 per cent.
However, the Indian economy is suddenly witnessing a sharp deceleration marked by low demand and production. The government has undertaken a series of steps in the recent past to reverse the economic downturn. The document analyses the trends in key parameters of the economy, the initiatives hitherto taken and gives the agency's opinion on what more is required.
The major issues faced by banks were stress assets in the books, liquidity and cost of funds was a terrible pain to NBFCs and MSMEs. The real estate sector post-demonetisation also faced a lot of stress while the bond market saw a major downside due to lack of demand from investors after the slew of defaults started last year.
The government, Reserve Bank of India (RBI), Securities Exchange Board of India (SEBI) and other regulators have taken several measures to boost consumption and investment activities and to alleviate stress, in a bid to revive the declining Indian economy, the agency said.
( With inputs from IANS )