The Reserve Bank of India’s rate-setting panel has revised its forecast for real gross domestic product (GDP) growth downwards to 6.8 per cent. “Even after this revision in our growth projections, India will still remain among the fastest-growing major economy,” Governor Das said. The biggest risks to the outlook remain global slowdown and tightening financial conditions.
In its last policy statement on September 30, the RBI’s Monetary Policy Committee (MPC) projected India’s GDP growth for the ongoing fiscal at 7 per cent.
Das said MPC has forecast Q3 GDP growth at 4.4%, and Q4 at 4.2%, with risks evenly balanced. The first quarter of the next financial year is set to grow at 7.1 %.
India’s GDP grew at 6.3% during the second quarter (July-September), in-line with most market participants’ expectations.
However, on Tuesday, the World Bank has revised upwards India’s GDP growth forecast for the current financial year to 6.9 per cent due to robust economic activities in the country, from the 6.5 per cent estimated earlier. It expects the retail inflation at 7.1 per cent in 2022-23, according to the World Bank’s latest India Development Update. The report, however, has flagged a deteriorating external environment.
The 6.9 per cent India growth forecast for FY23 is higher than the World Bank’s earlier projection of 6.5 per cent given in October. In October, it warned that spillovers from Russia’s invasion of Ukraine and global monetary tightening will weigh on the economic outlook. Before this, the World Bank had estimated a growth of 7.5 per cent earlier.
“India is more resilient now than it was 10 years ago. All steps taken over the past 10 years are helping India navigate the global headwinds,” said Dhruv Sharma, senior economist at The World Bank, according to news agency ANI.
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