ADB scales down India growth estimate further to 9.7% in FY22

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The Asian Development Bank for the second time in three months has scaled down India’s growth estimate for the fiscal year ending March 2022 due to supply chain issue of industries.

The Manila-based multilateral development bank pegged India’s growth estimate at 9.7 per cent for the current fiscal year in its latest supplement. The ADB had projected a growth rate of 10 per cent for FY22 in its September supplement.

In a supplement to the Asian Development Outlook (ADO) 2021, it said South Asia is forecast to grow at 8.6 per cent in 2021, compared with the September’s forecast of 8.8 per cent.

"India, South Asia’s largest economy, is now expected to grow 9.7 per cent in fiscal year (FY) 2021, which ends 31 March 2022. The reduction of 0.3 percentage points comes amid supply chain issues that are affecting industry. India’s outlook for FY2022 is maintained at 7.5 per cent, as domestic demand is expected to normalize," as per the ADB supplement.

In September, it had revised down India’s economic growth forecast for the current fiscal to 10 per cent, from 11 per cent predicted earlier, citing the adverse impact of the second wave of the pandemic.