GDP forecast lowered to 7%-7.5% for 2015-16
NEW DELHI: The Indian economy will likely grow at 7%-7.5% in 201516, slower than 8.1%-8.5% estimated in February, hit by two years of back-to-back droughts, plunging exports and weak private sector investment, the government said on Friday.
Despite the growth downgrade, India which grew at 7.2% in April to September will remain the world’s fastest growing major economy outpacing neighbouring titan China that is set to grow at about 7%.
“We estimate that real (inflation-adjusted) GDP for the year as a whole will lie in the 7%-7.5% range,” the finance ministry said in the Mid-year Economic Analysis tabled in Parliament on Friday, but cautioned that there were “mixed signals” coming in from various markers.
The economy has made considerable progress but challenges remain, the analysis said.
“The real economy is showing signs of recovery. At the same time, the improvement in growth has been uneven, powered only by private consumption and public investment,” it said.
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