According to a report published in BBC, the rate of industrial growth in India has gone down sharply in the month of September. It happened because of higher interest rates and a rising value of Indian rupees against the US dollar in international market.

The government data said that India’s industrial growth slowed to 6.4 percent in September while it was 10.7 percent in August 2007 and 12% in September 2006. The growth has been reduced by almost half if we compare with the industrial growth in September 2006.

The market experts have said that the five-times interest rate increase from mid-2006 to March 2007 and almost 12% increase in the value of Indian currency have hurt the broader economy.

DK Joshi at Crisil in Mumbai said that if it happened again in the month of October it would be a cause for serious concern for Indian economy. However, the market experts have said that the industrial growth numbers are provisional data and are often revised significantly.

Finance minister P Chidambaram said on the September data that he would not draw any conclusions from one month’s data. He said:

My own feeling is that both industry and services could record growth rates close to 10 percent in 2007. That means about 83 percent of the economy is going to grow between 9 and 10 percent.

According to the Commerce and Industry Ministry, the manufacturing sector has grown up with 6.6% in September while it was 12.7% in September 2006. The electricity generation shows the growth of 4.5% in September while it was 11.3% in September 2006.