According to the Economic Survey 2008-09 presented to the Parliament by the Union finance minister, Pranab Mukherjee on Thursday, India's economic growth decelerated to 6.7% in 2008-09 compared to 9% in 2007-08 and 9.7% in 2006-07. Per capita growth is estimated at 4.6%. Deceleration in growth spreads across all sectors except mining and quarrying.
Agriculture growth fells from 4.9% in 2007-08 to 1.6% in 2008-09. Manufacturing sector grows at mere 2.4% - the slowdown attributed to fall in exports and a decline in domestic demand.

However, investment remained relatively buoyant, ratio of fixed investment to GDP increased to 32.2% in 2008-09 compared to 31.6% in 2007-08. Government's fiscal deficit to GDP ratio stood at 6.2%. Bank's credit growth declined in the later part of 2008-09 reflecting slowdown of the economy in general and the industrial sector in particular.

Increased plan expenditure, reduction in indirect taxes, sector specific measures for textile, housing, infrastructure through stimulus packages provided support to the real economy.

Merchandise export grew at a modest 3.6% in US Dollar terms while overall import growth pegged at 14.4%.

The Economic Survey claimed that a large domestic market, resilient banking system and a policy of gradual liberalisation of capital account helped early mitigation of the adverse effect of global financial crisis and recession. It said that sharp dip in the growth of private consumption was a major concern at this stage. Medium to long-term capital flows likely to be lower as long as the de-leveraging process continues in the US economy.

The Survey finally suggested revisiting the agenda of pending economic reforms imperative to renew growth momentum.