The country's gross domestic product (GDP) growth slumped to a nine-year low of 5.3 percent in the quarter ended March 31, 2012.
In the financial year 2011-12, the GDP growth slumped to 6.5 percent, as compared to 8.4 percent in the previous year.
In contrast, Planning Commission Deputy Chairman Montek Singh Ahluwalia told reporters separately that the economy is expected to grow in the range of six to 6.5 percent in the current financial year.
On price rise, Basu said that core inflation is likely to come down to seven percent by September.
"My expectation is that inflation in the month of September will go below seven percent," he said.
Core inflation was recorded at 7.25 percent in June as per the latest available data. However, the real worry is food inflation, which remains a double-digit figure. Food inflation accelerated to 10.81 percent in June, as compared to 10.74 percent in the previous month.
In the first-quarter review of the monetary policy, the Reserve Bank of India, on July 31, kept key policy rates unchanged for the second time since June, saying that lowering of rates would aggravate inflationary pressure.
Basu said that the central bank's move was in a right direction. "RBI has said 'Pause'. RBI has made the right move, and the lowering of SLR is a very important small move. It will give the right indication."
The central bank cut the statutory liquidity ratio (SLR) by a percentage point to 23 percent to ease the flow of credit to industry. This move is expected to add INR60,000 crore liquidity in the markets.
Basu retired on July 31.