Moody’s Investors Service Wednesday estimated that India will grow 7.6% in calendar year 2018 and 7.5% in 2019, amid signs of economic recovery from impact of demonetization and goods and services tax (GST).
“There are some signs that the Indian economy is starting to recover from the soft growth patch attributed to the negative impact of the demonetization undertaken in 2016 and disruption related to last year’s rollout of the Goods and Service Tax,” it said.
The Budget for 2018-19 includes some measures that could stabilize the rural economy.
The Indian economy is projected to grow at 6.7 percent in the current financial year and 7.5 percent in 2018-19, economic think-tank NCAER had stated earlier. The figures are in line with the growth projections in this year’s Economic Survey, which said India is likely to clock 7-7.5% growth in 2018-19, up from 6.75 % in the current fiscal.
“NCAER forecasts a growth of 6.7 percent for the Gross Domestic Product (GDP) at market prices… For 2018-19, NCAER forecasts a growth of 7.5 percent for GDP at market prices,” it said.
In a statement, the National Council of Applied Economic Research (NCAER) also said that in 2017-18, the real agriculture Gross Value Added (GVA) is envisaged to grow at 1.0 percent, real industry GVA at 5.2 percent, and real services GVA at 8.0 percent.
It further said the wholesale price index (WPI) inflation is projected at 6.4 per cent for 2017-18. The growth rates in exports and imports, in dollar terms, are estimated at 12.8 per cent and 24.8 per cent, respectively. The statement said current account balance and central fiscal deficit, as percentages of GDP, are projected at -2.0 percent and 3.5 percent, respectively, for 2017-18.
The budget for 2018-19 includes some measures that could stabilize the rural economy that was disproportionately hit by the demonetization policy and is yet to recover, it said. “As we have said before, the bank recapitalization plan should also help credit growth over time, thereby supporting growth,” Moody’s said.
The Budget for 2018-19 includes some measures that could stabilize the rural economy that was disproportionately hit by the demonetization. “As we said before, the bank recapitalization plan should also help credit growth over time, thereby supporting growth,” Moody’s said.
Noting that the RBI maintained status quo at its sixth bi-monthly policy meeting in February 2018, the statement said, “Based on the current and evolving macroeconomic situation of the economy, the RBI is expected to continue with the neutral liquidity stance in the coming months.”