Media ININ Economy We Trust
Media IN DELHI 5th-07-2019
India’s economic growth is projected to recover this year from its lowest level since five years, as the political stability in the Asian nation boosted a pickup in demand and investment inflows.
In real terms, India’s gross domestic product (GDP) for the fiscal year started last April is expected at 7%, the Finance Ministry said in its annual Economic Survey report. This compared with the 6.8% growth recorded last year, while it matched the Reserve Bank of India’s (RBI) estimate, which was lowered last June from 7.2%.
A dim global economic outlook amid US-China trade tensions led the Reserve Bank of India to cut interest rates three times this year, while the focus turned to the government’s budget on Friday, with anticipations of measures to boost the economy.
Moreover, with oil prices remaining below their last year’s highs, consumption, which accounts for 60% of the GDP, is set to remain supported, the report said.
Nevertheless, a recovery in consumption is still linked to a rebound in the farm sector growth, which depends on the rainfall. The southwest monsoon rainfall, on which more than half of India’s farmland relies, has been below average.
Other downside risks, however, include weaker exports and a spillover of the stress in shadow banking sector to this year.
