Breaking News

You are here » Indian-Commodity  :  Economy  :  Care Ratings estimates India's GDP to accelerate to 7.5% in FY19

25-May2018

Care Ratings estimates India's GDP to accelerate to 7.5% in FY19

Credit rating agency, Care Ratings in its latest report titled 'Indian Economy Prognosis: 2018-19' has forecasted that India's gross domestic product (GDP) growth will accelerate to 7.5% in 2018-19, from 6.6% in the last fiscal. It added that the growth will be dependent on favorable monsoon, pick up in investment and increased private sector spending supported by continued government spending. However, it pointed out that some areas of concerns are headline inflation, lending rates, fiscal prudence, current account deficit (CAD) and exchange rates.

The rating agency estimated that CAD will widen up to 2.5% of GDP for FY19, from the 1.7% for the first nine months of FY18, due to wider trade deficit, an estimated slowdown in the portfolio flows and increased oil prices. It also expects that farm sector growth to inch up to 4%, from the 3% in the year-ago period, and industrial output growth to go up to 6%, from 4.3% in the previous year. Besides, it noticed that meeting the wider 3.3% target on the fiscal deficit will be difficult and adherence will depend on achievement of the Rs 80,000 crore divestment target, goods and services tax (GST) collections and tax receipts. 

On the inflation front, the report said that the consumer price inflation will go up to 5.5% for the fiscal, from the 3.6% in FY18, which may result in rate hikes of up to 0.50% by the inflation-focused Reserve Bank of India during the year. For the banking sector, it said that it will have an 'upward bias' with credit growth estimated to increase to 12% and deposits to expand by 10% and added that non-performing assets (NPAs) will be a major challenge for lenders.

Care Ratings has said that the estimates in the report have been made assuming that crude oil does not spiral over the present $80 per barrel and settles down at up to $75. It also said that the exchange rate will slip further to the 67-68 levels against the US dollar by the end of FY19 and added that the reserves will grow marginally to $435 billion, from $425 billion at present.


Related News

View all news

Suresh Prabhu reviews proposed agriculture export, new industrial policies

Commerce and Industry Minister Suresh Prabhu has reviewed proposed agriculture export policy and new industrial policies. He also scrutinized various export promotion strategies. He said that the government......

India needs to improve wage policies to promote inclusive growth: ILO

In order to promote inclusive growth in India, the International Labour Organisation (ILO) in its latest report title 'India Wage Report: Wage policies for decent work and inclusive growth' has stated......

Need to boost crop productivity using fewer resources to double farmers' income: Niti Aayog

In order to achieve the target of doubling farmers' income by 2022, the Niti Aayog member Ramesh Chand has said that there is a need to boost crop productivity using fewer resources. He also pointed out......

Top News

View all news

CG Power's JV inaugurates HV, EHV factory in Indonesia

CG Power and Industrial Solutions' (CG) joint venture (JV) PT CPSI has inaugurated Indonesia's first High Voltage (HV) and Extra High Voltage (EHV) factory at the Modern Cikande Industrial Estate, Banten......

MCX inks MoU with Indian Cotton Federation: Report

Multi Commodity Exchange of India (MCX) has reportedly signed memorandum of understanding (MoU) with Coimbatore-based Indian Cotton Federation (ICF). The agreement is to facilitate potential collaboration......

RIL's telecom arm tops Fortune's 'Change the World' list

Reliance Industries' (RIL) telecom arm -- Reliance Jio -- has ranked as the top company globally on Fortune's 'Change the World' list that ranked companies using the profit motive to tackle social problems......