{"id":6238,"date":"2020-06-10T16:37:15","date_gmt":"2020-06-10T16:37:15","guid":{"rendered":"http:\/\/financeintellect.com\/home-page\/home\/?p=6238"},"modified":"2020-06-10T16:37:15","modified_gmt":"2020-06-10T16:37:15","slug":"indian-economy-to-grow-at-9-5-next-fiscal-fitch-ratings","status":"publish","type":"post","link":"https:\/\/financeintellect.com\/home-page\/home\/indian-economy-to-grow-at-9-5-next-fiscal-fitch-ratings\/","title":{"rendered":"Indian Economy to grow at 9.5 % next fiscal : Fitch Ratings"},"content":{"rendered":"<div>Mumbai, June 10 : The Indian Economy which has slowed down during FY 20-21 due to Corovirus pandemic is poised to bounce back with a sharp growth rate of 9.5 per cent in the next fiscal,\u00a0<a href=\"https:\/\/www.fitchratings.com\">Fitch<\/a> Ratings said on Wednesday.<\/div>\n<div><\/div>\n<div>Fitch Ratings has forecast a 5 per cent contraction in GDP in the ongoing FY. &#8220;The Pandemic has drastically weakened India\u2019s growth and laid down challenges caused by a huge public-debt\u00a0burden,\u201d Fitch Ratings said in its APAC Sovereign Credit Overview released on Wednesday.<\/div>\n<div><\/div>\n<div>However, the Economy is likely to bounce back next fiscal with a growth rate of 9.5 per cent, it said.<\/div>\n<div><\/div>\n<div>\u201cAfter the global crisis, India\u2019s GDP growth is likely to return to higher levels than \u2018BBB\u2019 category peers, provided it avoids further deterioration in financial sector health as a result of the pandemic,\u201d\u00a0it said.<\/div>\n<div><\/div>\n<div>On March 25, India resorted to a lockdown all over the country to contain Coronavirus pandemic, resulting in halt of almost all the economic activities. The lockdown was extended repeatedly though some restrictions were lifted in phases in zones with less infections. Despite the lockdown, the cases of Coronavirus have continued to rise.<\/div>\n<div><\/div>\n<div>In order to support the Economy and control inflation, the Reserve Bank of India eased its monetary policy by cutting down police rates with a recent 40 basis points slash in Repo rates in order\u00a0to provide liquidity. As a result, Banks have also resorted to a cut in lending rates.<\/div>\n<div><\/div>\n<div>\u201cThe Government has announced stimulus measures amounting to 10 per cent of GDP, of which the fiscal component of about one percent of GDP is significantly less than many of India\u2019s peers,&#8221;\u00a0the rating agency said.<\/div>\n<div><\/div>\n<div>India\u2019s ratio of public debt\/GDP is expected to rise to 84 per cent of GDP in 20-21 up from a forecast of 71 per cent when Fitch Ratings affirmed the \u2018BBB\u2019 rating in December 2019, it said.<\/div>\n<div><\/div>\n<div>\u201cThis is based \u00a0on our expectation of slower economic growth in FY21 and wider fiscal deficits, assuming that the Government\u2019s fiscal response remains restrained\u201d, the agency further said.<\/div>\n<div><\/div>\n<div>\u201cThe credit profile is strengthened by relative external residence stemming from solid foreign-reserve buffers, but weakened by some lagging structural factors, including governance indicators and GDP per capita.\u201d<\/div>\n<div><\/div>\n<div>Citing the positives for India, Fitch Ratings said there was a greater confidence in sustained reduction in general government debt over the medium term to a level closer to \u2018BBB\u2019 peer median. There\u00a0is also a possibility of higher sustained investment and growth rates without the creating of macroeconomic imbalances such as from successful structural reform implementation.<\/div>\n<div><\/div>\n<div>Among the negatives it said there was a material increase in the fiscal deficit, causing the gross general government debt\/GDP ratio to be placed on a sustained upward trajectory. Besides there was\u00a0a loose macroeconomic policy settings that cause a return of persistently high inflation and widening current-account deficits which would increase the risk of external funding stress, the agency added.<\/div>\n<div><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Mumbai, June 10 : The Indian Economy which has slowed down during FY 20-21 due to Corovirus pandemic is poised to bounce back with a sharp growth rate of 9.5 per cent in the next fiscal,\u00a0Fitch Ratings said on Wednesday. Fitch Ratings has forecast a 5 per cent contraction in GDP in the ongoing FY. [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":6239,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1,5,31],"tags":[4216,4240,3566],"class_list":["post-6238","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy-and-politics","category-markets","category-news","tag-covid","tag-fitch","tag-indian-economy"],"aioseo_notices":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.9 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Indian Economy to grow at 9.5 % next fiscal : Fitch Ratings - Finance Intellect<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/financeintellect.com\/home-page\/home\/indian-economy-to-grow-at-9-5-next-fiscal-fitch-ratings\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Indian Economy to grow at 9.5 % next fiscal : Fitch Ratings - Finance Intellect\" \/>\n<meta property=\"og:description\" content=\"Mumbai, June 10 : The Indian Economy which has slowed down during FY 20-21 due to Corovirus pandemic is poised to bounce back with a sharp growth rate of 9.5 per cent in the next fiscal,\u00a0Fitch Ratings said on Wednesday. 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