After a broad-based deceleration in the initial quarters of this fiscal, India’s growth rate is projected to fall to 6 per cent in 2019-20, the World Bank said Sunday, in what was the sharpest downward revisions of its growth projections for South Asian nations.
However, the bank, in its latest edition of the South Asia Economic Focus, said the country was expected to gradually recover to 6.9 per cent in FY21 and 7.2 per cent in FY22 as it assumed that the monetary stance would remain accommodative, given benign price dynamics. The World Bank’s previous projection for India was 7.5 per cent, and this was announced in April.
The World Bank report, which has been released ahead of its annual meeting with the International Monetary Fund, noted in the first quarter of 2019-20, the economy experienced a significant and broad-based growth deceleration with a sharp decline in private consumption on the demand side and the weakening of growth in both industry and services on the supply side.
Moody’s Investors Service had last Thursday cut its forecast for India’s FY20 GDP growth by 40 basis points to 5.8 per cent, in what reflected a continuing trend of such downward revisions by prominent domestic and foreign agencies. —FE WITH PTI