Industry's worst fears may come true in 2012: FICCI

NEW DELHI: The Indian industry feels that its "worst fears" are coming true and the global meltdown may snowball into a full-blown crisis in 2012, a Ficci survey said.

In the backdrop of uncertain economic outlook, at least half of the corporates covered under the survey said they were holding on to cash balances and investment plans "for better future opportunities."

The survey conducted during September and October across several sectors, including manufacturing concluded "there is an increasing apprehension amongst Indian corporates that the current global meltdown might snowball into a full-blown crisis and last at least till the end of 2012."

These findings come in the backdrop of the industrial production declining by 5.1 per cent in October compared to a growth of 11.3 per cent in the same month last year.

As many as 83 per cent of the corporates covered under the survey said, "There is a long and arduous road ahead for Indian trade and industry."

In the Second Quarter Review of Monetary Policy, the Reserve Bank said since October the global economic outlook, amid euro zone crisis, has worsened significantly and is posing threats to emerging market economies including India.

In October, the RBI had revised downward its growth projection to 7.6 per cent from 8 per cent earlier, citing high inflation and global slowdown as major reasons.

The government has already lowered its estimates for the economic growth to 7.5 per cent from 9 per cent.

India's economic growth rate slipped to a nine-quarter low of 6.9 per cent in the July-September quarter of this fiscal. It was 8.4 per cent in the corresponding period last year.

The country's headline inflation stood at 9.11 per cent in November.