The international financial institution cut its projection for India's economic growth from 0.3 percentage points to 7 per cent for the fiscal year 2019-20, due to its outlook on the GDP that hit a seven-year-low
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International Monetary Fund (IMF) said on Thursday that the growth of India's economy is "much weaker" than expected observing the uncertainty over the corporate and environmental regulatory and weakness seen in some non-Bank financial companies.
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"Again, we will have a fresh set of numbers coming up but the recent economic growth in India is much weaker than expected, mainly due to corporate and environmental regulatory uncertainty and lingering weakness in some non-Bank financial companies and risks to the outlook are tilted to the downside, as we like to say," IMF spokesman Gerry Rice was quoted by ANI while speaking at a news conference.
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According to the government data, the fiscal GDP saw a seven-year low in recording to 5 per cent in April to June quarter, from last year’s 8 per cent. Due to the "weaker-than-expected outlook" for the domestic demand, the international financial institution cut its projection for India's economic growth from 0.3 percentage points to 7 per cent for the fiscal year 2019-20. However, the growth is expected to rise to 7.2 per cent points in FY21, which is lesser than the projected growth rate of 7.5 in the earlier report. The GDP was recorded to a low at 4.9 per cent in April to June 2012-13.
The Ministry of Statistics and Programme Implementation released a statement crediting the sharp dip in the manufacturing sector and agriculture output for the slowdown. Moreover, consumer demand and private investment have also weakened amid frictions seen in global trade and dampening business sentiment.
With inputs from ANI
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