India's GDP to grow at 6.5 pct in 2008/09 - UBS

MUMBAI (Reuters) - UBS said on Wednesday it expects India's economy to slowdown to 6.5 percent in the 2008/09 fiscal year ending March due to the downturn in capital expenditure and manufacturing.

- Asia's third largest economy grew 9 percent in the last fiscal year.

- UBS expects further deterioration in growth to 6 percent in 2009/10.

- Expects bank credit growth to slow to 15-20 percent in 2009. It grew 27.7 percent year-on-year in early November.

- M3 growth is also likely to remain in the 15-20 percent range "cushioned by easy domestic monetary policy through 2009".

- Expects current account deficit to widen $30 billion in the current fiscal year from $17.4 billion 2007/08.

- Expects current account deficit to narrow to $10 billion in 2009/10 financial year. "Even with only 6 percent export growth and flat imports, oil prices would have to average only sub-$60 barrels through 2009 to produce a current account surplus," UBS said in a client note.

- Expects the rupee to rise to 52 per dollar by the end of 2008. By the end of 2009, it expects the rupee at 48.