India is projected to grow at 8% over the current fiscal year (April 1- March 31), and 7.1% over the next (FY 2023-24) fiscal year, the World Bank said in its twice yearly South Asia Economic Focus Reshaping Norms: A New Way Forward, released on Wednesday, in the run-up to the World Bank IMF Spring Meetings. The country is estimated to have grown at 8.3% in the fiscal year that just passed, following a contraction of 6.6% in the previous year owing to the COVID-19 pandemic.
For the South Asia region, growth is expected to be slower than projected, by 1 percentage point, at 6.6% in 2022 and 6.3% next calendar year. This is due to Russia’s war on Ukraine, which has impacted the region, when it was already experiencing “uneven and fragile” growth, rising commodity prices, bottlenecks to supply and financial sector vulnerabilities.
The impact of the war so far has been further inflation, deteriorating current account balances and growing fiscal deficits, according to the report.
