India Ratings and Research has revised downward the country’s Gross Domestic Product growth to 6.7 per cent, from an earlier estimate of 7.3 per cent for the current fiscal due to weak consumption demand, monsoon and slowdown in manufacturing growth. It said the rising global trade tension will also have an adverse impact on exports.
The downward revision of growth by the domestic rating agency comes days after Moody’s Investors Service had cut the GDP growth forecast for 2019 calendar year to 6.2 per cent, from the previous estimation of 6.8 per cent. Even on a quarterly basis, the first quarter of this fiscal is expected to be the fifth consecutive quarter of declining GDP growth at 5.7 per cent, the report said.
The rating agency expects GDP growth to recover to 7.4 per cent in the second half of this fiscal, mainly on account of the base effect. The report said the recent measures announced by the government to boost the economy are likely to support growth only in the medium term.