4.9 per cent: Moody's forecast of India's economic growth for 2019-20 has declined by 1.3 percentage points from 6.2 per cent at the beginning of the year. It was 7.4 per cent in 2018.
- On October 10, Moody's had first slashed its India's FY20 economic growth forecast to 5.8 per cent.
- The reason it cited was that government measures did not address the widespread weakness in consumption demand.
- Now, Moody's has further lowered its FY20 India GDP growth projection to 4.9 per cent.
- The major factors cited this time are financial stress, low job creation and liquidity constraints.
- Meanwhile, Fitch Ratings has cut its FY20 India growth forecast to 4.6 per cent, citing a credit squeeze and reduction in business and consumer confidence. Previously, it had estimated 5.6 per cent growth for India’s GDP in FY20.
- However, Fitch expects India growth to gradually recover to 5.6 per cent in FY21 and 6.5 per cent the following year.
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A few links for further reading
Invest and emigrate
The great Indian dream of settling abroad is achievable if one has a few crores to invest. Rich nations offer a variety of investment options in a quid pro quo arrangement: immigrants get a better quality of life and revenue from them helps these countries’ finances. Wealthy Indians, troubled by polluted cities and the red tape holding up entrepreneurship, may want a quick ticket out of the country. Sanjay Kumar Singh lists a range of options: from a Canadian province’s investor programme to America’s US EB-5 plan.
Small savings schemes
Investors in small savings schemes breathed a sigh of relief when the government announced on October 1 that interest rates on these instruments would not be revised for the fourth quarter of the calendar year. With the economy witnessing a slowdown, and the stock markets also turning volatile, many investors are looking for alternative avenues to park their savings. Small savings schemes, with their sovereign guarantee, have emerged as a viable alternative.
Hard path to growth
The signals for the economy are not positive: overall demand is yet to pick up; the share of total exports in India’s GDP is declining, and industrial output pattern remains worrying.