New Delhi: International rating agency, Morgan Stanley has reduced India’s FDP growth rate to 7.9%. The rating agency said that the rising crude oil prices due to the Russian-Ukraine war and tighter financial conditions and trade will impact India’s GDP in the forthcoming financial year of 2022-23.
The agency also raised India’s retail inflation projection to 6 %. The current account deficit is raised to 3% of GDP.
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India is 85% dependent on imports to meet its oil needs and the recent surge in international oil prices, which pushed rates to a 14-year high of $140 per barrel before retracting, will result in the country paying more for the commodity. Also higher prices will result due to the inflationary pressure.
Earlier an US based rating agency, Moody’s Investors Service has raised India’s growth to 9.5% from 7%. The US based agency said that the economy of the country has recovered from the national lockdown of 2020 and the second wave of the Covid-19 pandemic.
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