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ADB cuts India’s GDP rate to 5.1% in FY20, cites poor job growth & rural distress

The Asian Development Bank had in September projected India's GDP growth at 6.5% in FY19 and 7.2% in FY20.

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New Delhi: The Asian Development Bank (ADB) on Wednesday trimmed its forecast for India’s economic growth in 2019-20 to 5.1 per cent saying consumption was affected by slow job growth and rural distress aggravated by poor harvest.

In September, ADB forecast India’s GDP to grow 6.5 per cent in 2019-20 and 7.2 per cent in the year thereafter.

“India’s growth is now seen at a slower 5.1 per cent in fiscal year 2019-20 as the foundering of a major non-banking financial company in 2018 led to a rise in risk aversion in the financial sector and a credit crunch.

“Also, consumption was affected by slow job growth and rural distress aggravated by a poor harvest,” it said.

ADB said growth should pick up to 6.5 per cent in the next fiscal year with supportive policies.


Also read: India’s shock GDP growth rate is a crisis Modi govt should not waste


 

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