The Asian Development Bank (ADB) on Wednesday lowered India’s economic growth forecast to 6.5% for the current financial year due to lower-than-expected growth in private investment and housing demand. Earlier it estimated the growth of 7%.
ADB (photo:ANI)
The Asian Development Bank (ADB) on Wednesday lowered India’s economic growth forecast to 6.5% for the current financial year due to lower-than-expected growth in private investment and housing demand. Earlier it estimated the growth of 7%.
The multilateral development bank has also lowered India’s growth forecast for the 2025-26 financial year.
“India’s outlook is adjusted downward from 7% to 6.5% for this year, and from 7.2% to 7% next year, due to lower-than-expected growth in private investment and housing demand,” ADB said.
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The report also said Asia and the Pacific’s economies are projected to grow 4.9% in 2024, slightly below ADB’s September forecast of 5%.
Asia and the Pacific’s economic growth will remain steady this year and next, but expected US policy changes under the incoming administration of President-elect Donald Trump are likely to affect the region’s long-term outlook.
ADB said India’s growth will remain robust, with the economy supported by higher agriculture output resulting from the summer (or kharif) crop season (which will also put downward pressure on food prices); continued resilience of the services sector; and lower-than-expected Brent crude prices in 2024 and 2025.
It further said strong forward-looking and labour market indicators, such as PMI for industry and services, urban labour force participation and Reserve Bank of India’s industrial outlook, suggest that economic momentum will recover in the coming quarters.
The said Southeast Asia’s growth outlook has been raised to 4.7% this year from a previous forecast of 4.5%, driven by stronger manufacturing exports and public capital spending.
For the next year, ADB kept the forecast unchanged at 4.7%, and kept the growth forecast for China unchanged at 4.8% this year and 4.5% next year.
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