THE WORLD Bank on Tuesday raised its forecast for India's GDP growth to 7 per cent for the current fiscal year, up from an earlier estimate of 6.6 per cent. This revision is attributed to increased government spending on infrastructure.
India’s economic growth had slowed to 6.7 per cent in the April-June quarter, as data from last week showed, due to reduced government spending during the national elections.
The Reserve Bank of India anticipates the economy to grow by 7.2 per cent in the fiscal year 2024/25.
The World Bank also noted that India’s medium-term economic growth rate is expected to remain robust, averaging 6.7 per cent over the next two fiscal years. It added that private investment is expected to gradually increase, supporting a recovery in consumption.
However, the report highlighted challenges such as job creation, noting that the urban unemployment rate remains high at an average of 17 per cent.
(With inputs from Reuters)
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