India could be world's fastest-growing major economy, says Fitch Ratings; Retains growth outlook at 7%

Given the stronger-than-expected outturn, Fitch forecasts growth at 7 per cent in the financial year ending March 2023 (FY23).

New Delhi, Dec 06: Global rating agency Fitch has retained the economic growth forecast for India at 7 per cent for the current fiscal in its global economic outlook. The ratings agency said that India could be one of the fastest-growing emerging market this year.

It, however, cut the projections for the next two financial years, stating that even though the country is shielded to some extent from global economic shocks but is not impervious to global developments.

In its December edition of the Global Economic Outlook, Fitch projected India's GDP to grow at 7 per cent in the current fiscal and slow to 6.2 per cent in 2023-24 and 6.9 per cent in 2024-25.

In September, Fitch had projected 7 per cent growth for the current fiscal, followed by 6.7 per cent in 2023-24 and 7.1 per cent growth in 2024-25.

Given the stronger-than-expected outturn, Fitch forecasts growth at 7 per cent in the financial year ending March 2023 (FY23).

"India is expected to record one of the fastest growth rates among emerging markets in our Fitch20 coverage this year," it said.

India is shielded to some extent from global economic shocks given the domestically focused nature of its economy, with consumption and investment making up the bulk of the country's GDP.

"However, India is not impervious to global developments. The worldwide economic slowdown is expected to reduce demand for Indian exports," Fitch said.

The Indian economy is expected to grow at 6.9 per cent in FY23, the World Bank said earlier today. This is up from its October estimate of 6.5 per cent due to the robust economic activities.

The Indian economy is more resilient today that what it was 10 years back, senior World Bank economist Dhruv Sharma said on Tuesday after the global financial body revised its FY23 GDP forecast for the country.

Speaking to ANI, Sharma said that India is more more resilient now than it was 10 years ago. All steps taken over the past 10 years are helping India navigate the global headwinds. He went on to credit the robust demand with helping revive the economy after it was battered by the pandemic and more recently the war in Ukraine.

He said that India's economy has rebounded fairly robustly following the contraction during the pandemic year and has largely been driven by robust domestic demand.