The chairman of Tata Motors, Ratan Tata, in his address to shareholders in the 2010-11 annual report of the company has expressed concern over the recent hike in repo rates by the Reserve Bank of India which have led to higher interest rates.

“The quarterly growth figures in Asia have been declining during the year and it is expected that both China and India will register lower growth rates in 2011-12. There is therefore a likelihood of a general slowdown in industrial activity in Asia compared to the growth rates achieved over the past few years and possibly a noticeable drop in consumer demand for goods and services,” says Tata.

There are already some tell tale signs in the automotive industries in emerging markets. He adds that China has seen a decline in automobile for the first time in two years and sales are declining in India.

Tata feels that concerned authorities should avoid any harsh steps and should balance between growth and containing inflation as “the health of the world economy in 2012 and beyond will depend more heavily on the economic health of Asia”.

In 2010-11, India’s passenger car market grew 30 percent over the previous year. During the April-June period, the growth was 7.3 percent.