Global rating agency Goldman Sachs has predicted that economic growth in India will slow down to 5.9% in the calendar year 2023 as compared to 6.9% in 2022, Mint reported on Monday.
“Growth will likely be a tale of two halves, with a slower first half as the reopening boost fades, and monetary tightening weighs on domestic demand,” the agency said. “In the second half, growth is likely to re-accelerate as global growth recovers, drag from net exports diminishes, and investment cycle picks up.”
India’s growth forecast was also reduced by Crisil to 7% from 7.3%, the Financial Express reported. It added that growth could slow down to 6% in the 2024 fiscal year.
Several rating agencies have cut India’s growth forecast between October and November.
Moody’s Investors Service on November 11 cut India’s economic growth forecast to 7% from its earlier estimate of 7.7%. It has cited the tightening of monetary policy, higher inflation and an uneven monsoon for its prediction.
The International Monetary Fund, on October 11, slashed the country’s 2022 growth forecast to 6.8% from July’s forecast of 7.4%. In its World Economic Outlook report, the financial institution had cited the Russia-Ukraine conflict and rising inflation as the reasons behind its revision.
The World Bank downgraded India’s economic growth forecast to 6.5% for the current fiscal year (2022-’23) from its earlier estimate of 7.5% announced in June. The growth estimate was revised downwards by one percentage point due to the deteriorating international environment.
India’s gross domestic product grew at 8.7% in 2021-’22 as against a contraction of 6.6% during the previous financial year, according to government data. The growth rate was less than the 8.9% estimated by the Ministry of Statistics and Programme Implementation.
The lower-than-expected figure was because of a drop in growth in the agriculture, mining, construction and manufacturing sectors.