World Bank sharply cuts India GDP growth forecast, raises global recession risk

Updated : Jun 08, 2022 11:48
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EJ Biz Desk

World Bank is expecting India's growth train to slowdown as the prolonged impact of Covid pandemic and the ongoing supply shocks from Ukraine and Russia continue to weigh.

"In India, growth is expected to slow to 7.5 percent in fiscal year 2022/23, with headwinds from rising inflation, supply chain disruptions, and geopolitical tensions offsetting buoyancy in the recovery of services consumption following the pandemic," according to the World Bank's latest Global Economic Prospects report.

Also read/watch| RBI raises inflation forecast sharply, price pain to remain

The bank sees India's growth slowing further to 7.1 percent in FY24 and the next year GDP growth has been pegged at 6.5 percent.

The pressure on India's growth comes from a global risk of recession, in fact even if that is averted the World Bank states "the pain of stagflation could persist for several years unless major supply increases are set in motion… Several years of above-average inflation and below-average growth are now likely, with potentially destabilising consequences for low- and middle-income economies."

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