India’s economy and related exchange traded funds (ETFs) could be slowing down as the previous inundation of cash and investments start to ebb.

In India, construction has come to a halt, the luxury art market has slowed and specialists with accredited degrees are either unemployed or taking pay cuts, report Vikas Bajaj and Somini Sengupta for The New York Times.

During the boom years, India’s growth was attributed to large flows of cash and investments, around 39% of GDP in 2008, coming into the country with more than a third coming in from abroad. In the last 3 months of last year, foreign loan and direct investment plummeted almost a third.

While the slowdown has impacted the country’s growth, it’s considered worse in economices such as Singapore and South Korea. In fact, India is believed to be better poised to resist a global slowdown, thanks to its low exports-to-GDP ratio, which is 14%-15%, reports Business Wire.

The International Monetary Fund (IMF) has reported that Indian companies are among the world’s most exposed as a result of heavy borrowing. It is also estimated that defaults among South Asian firms could jump up to 20%.

In the fourth quarter of 2008, the economy grew 5.3%, the slowest rate in five years. The government predicts a 6% growth this year while the IMF projects a 4.5% growth. There will be increased fiscal spending on infrastructure and social programs, and the Central Bank has reduced its benchmark interest rates.

• WisdomTree India Earnings (EPI): up 21.9% year-to-date

• PowerShares India (PIN): up 19.3% year-to-date

Max Chen contributed to this article.

Tags: Asia, Emerging Markets, EPI, Global ETFs, India, PIN