NEW DELHI: The World Bank (WB) and Asian Development Bank (ADB) have announced slightly slower growth rates for the Indian economy during the current fiscal due to a slowdown in consumption and difficult conditions abroad.
The World Bank’s latest ‘India Development Update’ (IDU) released on Tuesday cut India’s GDP forecast to 6.3 per cent against its earlier projection of 6.6 per cent for 2023-24.
The Asian Development Bank’s (ADB) latest report also cut India’s economic growth to 6.4 per cent in the current fiscal from its earlier forecast of 6.8 per cent for 2023-24. The World Bank said South Asia’s largest economy would be hit by high borrowing costs and slower income growth. The ADB also cited tight monetary conditions besides elevated oil prices for its downward projection.
The point about high interest rates has been made by both multilateral lending institutions when the RBI is poised to announce its monetary policy on Wednesday. The market and experts expect the RBI to announce only a 25 basis point hike.
At the same time, the World Bank noted that India would remain one of the fastest growing economies and said this was reflected in expectations of 6.9 per cent growth in 2022-23. Growth was underpinned by strong investment activity bolstered by the government’s capex push and buoyant private consumption, particularly among higher income earners.