World Bank cuts India's economic growth forecast to 7.5% for FY23

Tags: Economics/Business

The World Bank on June 7 slashed India's economic growth forecast for the current fiscal to 7.5 per cent, keeping in mind rising inflation, supply chain stagnation and geopolitical tensions.

• This is the second time that the World Bank has revised its GDP growth forecast for India in the current fiscal year 2022-23 (April 2022 to March 2023).

• In April 2022, the World Bank had lowered the forecast from 8.7 percent to 8 percent, after which it is now estimated to be 7.5 percent.

• Economic growth forecast expected to be 7.1 percent in 2023-24

• The World Bank report also said that India's growth is expected to slow further to 7.1 per cent in 2023-24.

• However, this is 30 basis points higher than the previous estimate of 6.8 percent.

• India's GDP growth 6.5 percent in 2025

• India's GDP growth for the financial year 2024-25 has been pegged at 6.5 percent by the World Bank.

• However, this figure of decline in the growth forecast for the financial year 2022-23 is higher than the local estimation.

• The Reserve Bank of India (RBI) has pegged GDP growth at 7.2 per cent for the financial year 2022-23.

• India's other growth projections 

• Global rating agencies also downgraded India's economic growth forecast.

• Moody's Investors Service cut its GDP forecast for 2022 to 8.8 percent from 9.1 percent, citing high inflation.

• S&P Global Ratings too had cut India's growth projection for 2022-23 to 7.3 per cent, from 7.8 percent. 

• In March, Fitch had cut India's growth forecast to 8.5 per cent, from 10.3 percent.

• The IMF has also lowered the projection to 8.2 percent from 9 per cent.

• Asian Development Bank (ADB) has pegged India's growth at 7.5 per cent.

• In April, the RBI lowered the forecast to 7.2 per cent from 7.8 per cent amid volatile crude oil prices and supply chain disruptions due to the Russia-Ukraine war.