ADB raises growth forecast for India


Owing to increased public spending and improved business confidence, the Asian Development Bank (ADB) has hiked its growth forecast for India from 5% to 6% this fiscal.
The update to ADB’s Asian Development Outlook (ADO) 2009 report released Tuesday said that India will grow at 7% in 2010, a revision from its earlier forecast of 6.5%.
“Normal rainfall in fiscal 2010, a pick-up in exports (as the recession ends in industrial economies), and strengthened investor confidence is now projected to lift GDP growth to 7% in fiscal 2010”.
“GDP growth in the second and third quarters is expected to fall below the 6.1% first-quarter expansion because of weak agriculture, but to recover sufficiently in the fourth to post a 6% annual expansion.”
According to ADB, “an increase in public spending, a quicker than expected return of capital inflows, stronger industrial production, and signs of improved business confidence will lift economic growth to 6 percent in India this year, up from an earlier estimate of 5%”.

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