S&P projects India's GDP growth at 7.3% this fiscal

In its monetary policy review on September 30, RBI is expected to hike rates by another 50 basis points to a three-year high level of 5.90%.

S&P Global Ratings on September 26, 2022 projected India's economic growth at 7.3% in the current fiscal with downside risks and said inflation is likely to remain above RBI's upper tolerance threshold of 6% till the end of 2022.

In its Economic Outlook for Asia Pacific, S&P said India's growth next year will get support from domestic demand recovery after the coronavirus pandemic.

"We have retained our India growth outlook at 7.3% for the fiscal year 2022-2023 and 6.5% for the next fiscal year, although we see the risks tilted to the downside," it said.

Other agencies have cut India's GDP growth forecast amid higher inflation and rising policy interest rates. Earlier this month, Fitch Ratings slashed the growth estimate to 7% for the current fiscal from 7.8 per cent pegged earlier. India Ratings & Research too had reduced its projections to 6.9% from 7% earlier.

Asian Development Bank has cut the projection to 7% from 7.5% earlier.

The Reserve Bank of India (RBI) expects the Indian economy to grow 7.2% in the current fiscal (April-March). The growth last year (2021-22) was 8.7%.

Indian economy expanded 13.5% in the April-June quarter, sequentially higher than 4.10% growth clocked in the January-March period.