Credit rating agency Crisil has cut the gross domestic product(GDP) estimate for India to 6.9% from 7.1% in 2019-20.
Crisil has said that revision in growth forecast was due to inadequate monsoon,slowing global growth and sluggish high-frequency data for the first quarter.
However,the report said that the second half should find support from expected monetary easing,consumption and statistical low-base effect.
The report noted that India’s GDP had grown at an impressive 8.2% in fiscal 2017.But it was derailed by disruptions stemming from policy initiatives,reforms and rising global uncertainty including from trade disputes.
Further,agricultural growth is also expected to improve with a pick-up in food inflation.In addition,farmers would benefit from income transfer of ₹6,000 per year announced by the Centre and farm loan waivers in a few states.
The report also said that the banking sector stressed assets are expected to come down to about 8% by the end of financial year 2019-20 based on lower additional NPAs and increased recoveries.
The report also expects corporate sector growth to slow to 8% in 2019-20 lower than the double-digit growth trend of the last two financial years.