India Economic Growth Slowest In Over 6 Years

India’s economy grew at the slowest pace in more than six years during the three months to December and the outlook does not look promising in the near term amid the coronavirus spreading across the world.

Gross domestic product grew 4.7 percent in the October to December quarter, official data showed Friday. The quarterly growth was largely supported by increased government spending.

The July to September quarter growth figure was significantly revised up to 5.1 percent from 4.5 percent reported earlier.

The growth rate for the April to March quarter was also revised higher to 5.6 percent from 5 percent.

The statistics ministry reiterated that the full year growth for the fiscal year 2019-20 is estimated at 5.0 percent, in line with the first advance estimate, versus 6.1 percent in 2018-19.

Earlier this month, the Reserve Bank of India projected the GDP growth for 2020-21 at 6.0 percent versus the government’s forecast of 6-6.5 percent.

The bank expects private consumption to rise, especially in rural areas, to recover on the back of improved harvest prospects.

In January, the International Monetary Fund cut the global growth forecasts for this year and next, mainly due to the weaker-than-expected expansion in India.

The global lender slashed India’s growth forecast for 2020 by 1.2 percentage point to 5.8 percent, and the outlook for next year was lowered by 0.9 percentage point to 6.5 percent. Growth was estimated at 4.8 percent in 2019.

The improvement in growth is expected to be supported by monetary and fiscal stimulus as well as subdued oil prices, the IMF said.

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