Indian rating agency ICRA has cut India’s gross domestic product (GDP) growth forecast for the fiscal year 2022-23 to 7.2 percent from eight percent earlier, citing elevated commodity prices and supply chain disruptions resulting from the Russian invasion of Ukraine, the agency said in a note issued on Tuesday, March 29.
The agency has forecast a GDP growth of 8.5 percent for the fiscal year 2021-22, lower than the 8.9 percent forecast by the National Statistical Office (NSO).
“Protracted geopolitical tensions, renewed lockdowns in parts of China, and high commodity prices post downside risks to the growth outlook and firms facing compressed margins could hurt growth in gross value added (GVA) in the economy,” the ICRA note said.
The private investment revival may be delayed due to these headwinds as capacity utilization in industry is likely to reach only 74-75 percent by the third quarter of 2022-23, from around 71-72 percent in the January-March quarter of 2021-22, ICRA said.
