Citing falling global demand and delayed monsoon curtailing agricultural growth as reasons for deceleration in the Indian economy, Asian Development Bank today lowered India's growth forecast for the current fiscal to 5.6 per cent from 7 per cent projected earlier. It said that growth will decelerate from 6.5 per cent in 2011-12 to 5.6 per cent in the current fiscal. It had earlier projected the country's growth rate at 7 per cent for 2012-13. Moreover, Industrial output is also expected to remain subdued in 2012-13, while weak demand from insudtrialised countries continues to take its toll on exports. ADB Chief Economist Changyong Rhee, However, expressed hope that India can start reversing this trend by improving its investment climate and expediting reforms.

For the Asian region as a whole, the ADB expects the Gross Domestic Product growth rate to drop to 6.1 per cent in 2012 from 7.2 per cent in 2011. The growth rate for the region has been projected at 6.7 per cent in 2013.