Asia’s third largest economy grew by 5% in the fiscal year between April 2012 and March 2013, compared to 6.2% the previous year, the latest data showed today.

India had been recording annual growth of 9% until a few years ago, but it has slowed since then and in recent months it has seen a sharp decline blamed on a slowdown in its manufacturing and services sectors.

Foreign investors have also kept away due to delays in key reforms.

Analysts have suggested weak private consumption, capital investment and slowing public spending will ensure there is no quick fix bounce back for growth in the country.

On a quarterly basis GDP increased by 0.1% in the last quarter compared with the same period last year, from 4.7% to 4.8%, but the Government said this may have been caused by a statistical base effect rather than a fundamental improvement in the economy.