World Bank projects India’s FY19 GDP growth at 7.3%

NEW DELHI: The World Bank on Wednesday projected India’s GDP growth at 7.3 percent for the next financial year and accelerate further to 7.5 percent in 2019 -20.

The World Bank’s biannual publication, India Development Update: India’s Growth Story, expects the economy to clock a growth rate of 6.7 per cent in the current fiscal ending March 31.

The report, however, observed that growth of over 8 per cent would require “continued reform and a widening of their scope” aimed at resolving issues related to credit and investment and enhancing the competitiveness of exports.

“The Indian economy is likely to recover from the impact of demonetisation, and the GST, and growth should revert slowly to a level consistent with its proximate factors — that is, to about 7.5 percent a year,” the report said.

In November 2016, the government had scrapped highvalue currency notes of Rs 500 and Rs 1,000 in a bid to check black money, among others.

Later, India implemented its most significant indirect tax reform -- Goods and Services Tax (GST).

Both of these initiatives had impacted the economic activities in the country in short run.

India’s economic growth had slipped to a three year low of 5.7 percent in April-june quarter of the current fiscal, though it recovered in the subsequent quarters.