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18 April 2024

Government says India’s growth to slow this year

Daily wage porters wait for work at a local market in Mumbai. (AFP)

India’s Ministry of Statistics says the country’s economy will grow 7.1 per cent this fiscal year, down from 9.0 per cent last year. If that turns out to be true, it would be the slowest India has grown since 2003.

The announcement comes as policy makers struggle to understand how much of India’s five-year economic boom was fuelled by outside financing, which has now dried up, and how much domestic demand will be able to offset waning exports.

In recent weeks, various government agencies have cut growth forecasts and documented a slew of job losses. In January, the Prime Minister’s Economic Advisory Council slashed its growth outlook for the year ending March 31 from 7.8 per cent to 7.1 per cent, and India’s central bank cut its growth forecast to 7 per cent.