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As corporate India struggles to cut down debt, the economy suffers

India's cash crunch and confusion over the introduction of a national sales tax were initially blamed for pulling economic growth down to its weakest pace in more than three years. But that is masking a more debilitating factor affecting the economy - corporate debt.Thomson Reuters data, based on the latest annual earnings reports, shows India's corporate debt rose to a seven-year high at the end of March. More than a fifth of large companies did not earn enough to pay interest on their loans and the pace of new loans fell to the lowest in more than six decades.The Indian government reported on Aug 31 that annual GDP growth in the quarter ended June dropped to 5.7 percent, an envious pace for many countries but India's weakest since early 2014.

News Source:- http://www.business-standard.com/article/economy-policy/as-india-inc-struggles-to-cut-down-debt-the-economy-suffers-117091300188_1.html