Connectivity & Partnership

Moody's cuts India's GDP forecast to 7.3% from 7.5%

Moody's Investors Service report on Wednesday has cut India's GDP growth forecast to 7.3 per cent in 2018, from previous forecast of 7.5 per cent due to higher oil prices and tighter financial conditions.
Jun 1, 2018
Moody's Investors Service report on Wednesday has cut India's GDP growth forecast to 7.3 per cent in 2018, from previous forecast of 7.5 per cent due to higher oil prices and tighter financial conditions.
 
"The Indian economy is in cyclical recovery led by both investment and consumption. However, higher oil prices and tighter financial conditions will weigh on the pace of acceleration. We expect GDP growth of about 7.3 per cent in 2018, down from our previous forecast of 7.5 per cent," the report said.
 
It, however, kept growth expectation for 2019 remains unchanged at 7.5 per cent.
 
Moody's further said: "On the domestic front, growth should benefit from an acceleration in rural consumption, supported by higher minimum support prices and a normal monsoon. The private investment cycle will continue to make a gradual recovery, as twin balance-sheet issues -- impaired assets at banks and corporates -- slowly get addressed through deleveraging and the application of the Insolvency and Bankruptcy Code." 
 
It said ongoing transition to the new Goods and Service Tax regime could also weigh on growth somewhat over the next few quarters, which poses some downside risk to its forecast. 
 
"However, we expect these issues to moderate over the course of the year," it said.

Leave a Reply

Your email address will not be published. Required fields are marked *

Air pollution battle in India needs a sense of urgency

If India takes the top place in GDP growth globally, why we have such lower targets in meeting air quality over five years, particularly considering the fact that it is the 65 percent of India’s young population would be the main victims of the worsening air quality, writes Rajendra Shende for South Asia Monitor . 

Read more...

Bangladesh, ADB sign deal for rural road network

 The Asian Development Bank (ADB) and the Bangladeshi government have signed an agreement for $200 million in loans to improve the rural road network in Bangladesh.

Read more...
Tweets about SAMonitor
SAM Facebook
SiteLock