World Bank sees India’s growth at 6.9% this year

NEW DELHI: India’s economy is expected to grow 6.9% in the current fiscal year, the World Bank said on Tuesday, adding that it is well positioned to tackle global headwinds.

Asia fourth-largest economy expanded 6.3% in the July-September quarter, and gross domestic product growth for the full fiscal year is likely to be 6.8-7%, the government said last week.

The World Bank raised its forecast for India’s growth to 6.9% for the current fiscal year from 6.5% earlier. The Bank trimmed its expectation for next fiscal year to 6.6% from 7% earlier.

India, like its global peers, has been plagued by a rise in commodity prices and tightening monetary policy by central banks worldwide.

However, the World Bank is confident that the global slowdown has a much lower impact on India, compared to other emerging economies.

“We have no concerns about India’s debt sustainability at this stage,” World Bank economist Dhruv Sharma said, adding that public debt had declined.

The report sees average retail inflation at 7.1% this year and warns that the fall in commodity prices could dampen inflationary pressures.

India’s annual retail inflation eased to a three-month low of 6.77% in October, but some economists believe it could take up to two years before the rate eased to 4% — the middle level of the Reserve Bank of India’s target.