Indian economy may take a year to recover

The ongoing slowdown in Indian economy, particularly the manufacturing sector, may take around a year before recovering fully. Morgan Stanley in a research report on Monday said that the weaknesses in the major industrialised economies will continue impacting India in most of 2009.

The global financial services giant also said that India’s economic growth would probably stand at 4.4% in the last quarter of 2009, higher from 3.5% in the preceding quarter. This is sharply in contrast with the government which expects the economy to grow by about 6-7% in FY10.

Morgan Stanley, on the other hand, has said that India’s exports will keep its growth lower through first half of the year and only towards later part of the 2009 will the recovery in developed countries see India’s exports improving.