As a result, growth declined to 6.7 per cent in 2008–09 from the preceding 5-year average of 8.7 per cent per annum (Table 2). Table 2  Restoring normalcy in financial markets, ensuring normal flow of credit to productive sectors of the economy as well as limiting the adverse impact on the real sector of the economy assumed policy priority.
The Reserve Bank, like most other central banks, took a number of conventional and unconventional measures to limit the adverse impact of the contagion on the Indian financial markets and the economy. These included augmenting domestic and foreign exchange liquidity and a sharp reduction in the policy rate.