Breaking News

You are here » Indian-Commodity  :  Economy  :  India's growth rate likely to improve to 7.3% in FY20: Crisil

24-Jan2019

India's growth rate likely to improve to 7.3% in FY20: Crisil

Crisil Ratings in its latest 'India Outlook FY20' report has stated that India's economic growth may improve to 7.3% in the fiscal year 2019-20 (FY20), provided that there are normal rains, oil prices lower than 2018 and a stable political outcome of the general elections. It also said that the country is expected to clock a growth rate of 7.2% in the current financial year (FY19), up from 6.7% in 2017-18. The report noted that with the government likely to stick to a fiscal consolidation path, the pick-up in growth is expected to be only gradual.

As per the report, a change in the growth mix is on cards, with private sector likely to take over the baton from the government. Highlighting that fiscal health remains a key risk, it said the fiscal deficit is likely to be 3.3% of the gross domestic product (GDP) in the next fiscal. The deficit is budgeted at 3.3% in the current fiscal. However, the rating agency cautioned that if the general elections this year yield a fractured mandate and derail/delay the process of reforms, the implications on sentiments, investments and growth could be adverse. Besides, it said global crude oil prices are expected to soften to settle at around $60-65 average per barrel in fiscal 2020, compared with $68-72 average per barrel in fiscal 2019 as overall global demand slows. Though, some price pressure could be felt in response to the recently announced supply cuts by the Organization of Petroleum Exporting Countries (OPEC).

On the inflation front, it said fiscal 2019 would be the second consecutive year of sub-4% Consumer Price Index (CPI)-based inflation, from an average 4.5% in fiscal 2017, CPI inflation fell to 3.6% in fiscal 2018. It further expects that inflation at 3.7% for fiscal 2019, given the continuous and sharp decline in food prices and slowdown in global crude oil prices compared with a few months ago. It said current account deficit (CAD) would reduce to 2.4% of GDP in fiscal 2020 from 2.6% in fiscal 2019. Moreover, the rupee will remain volatile and settle at 72 to a dollar on an average by March 2020, compared with an estimate of 71 to a dollar by March 2019. It added that domestic interest rates, which had risen last year, are expected to soften in fiscal 2020.


Related News

View all news

Job creation trebles in February to reach 8.61 lakh: EPFO

The Retirement fund body, Employment Provident Fund Organisation (EPFO) in its latest 'Net Payroll Data' report has showed that job creation in India's formal sector almost trebled to 8.61 lakh in February......

Reform process in India must be completed in coming five years: Arvind Panagariya

In order to create decent jobs for the masses as well as give serious thought to privatising the public sector banks (PSBs), Arvind Panagariya, who had served as the first Vice Chairman of the NITI Aayog......

P-notes investment jumps to Rs 78,110 crore at March-end

With positive market sentiments, the share of foreign portfolio investments (FPI) in domestic capital markets through participatory notes (P-notes) jumped to Rs 78,110 crore at the end of March. According......

Top News

View all news

Bank of Baroda's board to consider issuance of equity shares of Rs 5,042 crore to Govt

Bank of Baroda's board is going to consider issuance of equity shares of Rs 5,042 crore to Government of India on a Preferential Basis. The meeting of the Board of Directors of the Bank is scheduled to......

Gujarat Petrosynthese to invest surplus funds in mutual funds, bonds, securities, shares

Gujarat Petrosynthese has received an approval to invest surplus funds in mutual funds, bonds, securities, shares, inter corporate deposits etc. to optimize its returns. The Board of Directors of the Company......

Reliance's Retail Unit delivers record-breaking performance in revenue, profits during FY19

Reliance Industries' Retail Unit--Reliance Retail has delivered a record-breaking performance in revenue and profits growth for the year 2018-19. Segment Revenue for FY19 grew by 88.7% Y-o-Y to Rs 130,566......