NEW DELHI: S&P Global Ratings on Tuesday raised India’s growth forecast for the next financial year to 6.8 per cent, but flagged restrictive interest rates as a dampener for economic growth.
The Indian economy is estimated to have clocked a growth of 7.6 per cent in the current fiscal.
In November, last year, the US-based agency had projected India’s growth to be 6.4 per cent in 2024-25 fiscal on robust domestic momentum.
“For Asian emerging market (EM) economies, we generally project robust growth, with India, Indonesia, the Philippines, and Vietnam in the lead,” S&P said in its Economic Outlook for the Asia Pacific.
In largely domestic demand-led economies such as India, Japan, and Australia, the impact of higher interest rates and inflation on household spending power reduced sequential GDP growth in the second half, S&P said.
“We expect India’s real GDP growth to moderate to 6.8 per cent in fiscal year 2025 (ending March2025),” S&P said.