India’s quarterly growth hit a near-decade low during Q1 2012. Companies need to wake up to the new reality and plan for a slowing macroeconomic environment in Asia’s third largest economy.

Companies need to immediately start evaluating how major aspects of their business are going to be impacted by India’s deteriorating fiscal and monetary conditions, which are caught in a vicious downward spiral.

Understanding The Downward Spiral

India is caught in a vicious cycle of domestic fiscal and monetary issues stemming from its strong populist agenda. Results so far include a weaker rupee, more expensive oil, higher inflation, and a possible decrease in the country’s international credit rating

Evaluating Impact on Your Business Value Chain

Companies should create an impact matrix to evaluate how individual macroeconomic drivers will impact their business activities. The impact matrix should scrutinize every step of the value chain from lending availability to machinery import, consumer demand, and overall ease of doing business.