India's economy continues on robust growth path: Asian Development Bank
What's the story
India's economy continues on a robust growth path, the Asian Development Bank (ADB) said today while maintaining the growth forecast for the current fiscal at 7.3%. "Its growth forecasts are unchanged at 7.3% for 2018 and 7.6% for 2019 as the temporary effects of the demonetization of large banknotes and the introduction of the national GST abate as expected," the ADB said. Here's more.
Reasons
ADB says escalating trade tensions will test resilience
Growth remains stable across most of developing Asia due to robust domestic demand, buoyant oil and gas prices, and a consolidation of India's growth rebound, the ADB said, in an update of its flagship annual economic publication, Asian Development Outlook (ADO) 2018. "But escalating trade tensions will test the region's resilience, underscoring importance of efforts to bolster trade ties among its countries," it added.
Challenges
Depreciation of rupee, volatile external financial markets pose challenges
The report of multilateral lending agency further said the impact of the rising oil prices is offset by robust domestic demand and rising exports, particularly of manufactures. "Depreciation of the rupee and volatile external financial markets pose challenges, as does accelerating inflation through tighter fiscal policy will help quell inflationary pressures," said the report of the Manila-based development bank.