India economy struggles to recover India's economy grew slightly faster than expected in the latest quarter and appeared to be recovering from a low point earlier this year, but one of the country's two main business organisations said it was "worrisome" that gross domestic product had again expanded at less than 5 per cent. GDP in Asia's third-biggest economy grew 4.8 per cent in the three months to September over the same quarter a year earlier, up from 4.4 per cent the previous quarter, according to the Central Statistics Office on Friday. Indian growth has halved in the past two years amid a grim investment climate, and the Congress-led coalition government of Manmohan Singh, prime minister, is hoping for a recovery before a general election due to be held by May next year. A good season of monsoon rains has boosted farm output, and the country is fast reducing its current account deficit after a sharp decline of the rupee. But persistent inflation of about 10 per cent and the threat of higher interest rates to tackle it have lowered expectations for growth. The International Monetary Fund forecasts annual growth of only 4.3 per cent in the fiscal year to March. "The growth of GDP at sub-5 per cent level for the fourth consecutive quarter is worrisome," said Chandrajit Banerjee, director-general of the Confederation of Indian Industry. The two drivers of growth this year - good monsoons and exports - are insufficient to pull the economy out of the present slowdown, as mining, manufacturing and service sector output remain subdued. Naina Lal Kidwai, president of Ficci, another business group, called the latest numbers "encouraging" but expressed concern about high inflation and the high cost of credit for companies. Miguel Chanco, Asia economist for Capital Economics, said Indian growth appeared to be "bottoming out," but he warned that India's road to recovery would be "slow and bumpy." With the central bank hawkish and the government determined to control its budget deficit, neither monetary nor fiscal policy would provide much support for growth. Investment activity is likely to stay subdued as the government's efforts so far have not had any visible success in reinvigorating appetite for new projects or in clearing project bottlenecks. Narendra Modi, prime ministerial candidate for the Bharatiya Janata Party, the Hindu nationalist opposition, has made growth and development the centrepiece of his election campaign and mocked Congress leaders for failing to deliver prosperity to India's 1.3bn people. P. Chidambaram, finance minister, said on Friday he expected the economy to grow 6 per cent in the next fiscal year, 7 per cent in 2015-16, and 8 per cent the year after that, but independent economists" GDP forecasts are about a percentage point lower in each case.