New Delhi, Dec 23: Industrial slowdown caused by a severe demand recession and low public expenditure in infrastructure and construction will pull down the economy through 1998, the Federation of Indian Chambers of Commerce and Industry (Ficci) has said. A majority of corporates surveyed by Ficci have said that the industry is in the throes of a major-slowdown, which would last for more than a year.

`It is clearly evident from the current survey that much larger number of corporates of the country are posting a larger turnaround period of the current slowdown. This reveals a greater apprehension in the minds of business community, the survey covering 303 corporates in the small, medium and large sector, reveals. The findings of the survey is ominous as the Confederation of Indian Industry has also predicted that the economy will remain depressed through out next year.

The survey traces the causes of the slump and offers policy prescriptions to revive the industrial growth and ranks over capacity and the recent political instability as the factors deterring growth and affecting investments next only to lack of demand.In the last six months, the concern of the industry has shifted from liquidity crunch and bottlenecks in credit availability to decline in demand.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.