NEW DELHI: The World Bank raised its gross domestic product (GDP) growth forecast for India during the current financial year (FY23) to 6.9 per cent from 6.5 per cent, citing the economy’s relative resilience to external headwinds, and “a strong out-turn” in the second quarter of the current financial year.
This revision in its FY23 GDP forecast comes two months after the Bank had cut India’s FY23 GDP forecast to 6.5 per cent from 7.5 per cent in an October update, which came in the wake of a series of growth downgrades by rating agencies, investment banks and other multilateral institutions.
“India’s economy has been remarkably resilient to the deteriorating external environment, and strong macroeconomic fundamentals have placed it in good stead compared to other emerging market economies,” Auguste Tano Kouame, World Bank’s country director in India, said in the agency’s latest India Development Update, “considering a strong outturn in India in the second quarter (July-September) of the 2022-23 financial year”.
The report forecasts that the economy will grow at slightly lower rate of 6.6 pc cent in fiscal FY24 from the earlier projected 7 pc. A challenging external environment will affect India’s economic outlook through different channels, the update said. It noted that rapid monetary policy tightening in advanced economies has already resulted in large portfolio outflows and depreciation of the Indian Rupee.
