New Delhi, Mar 16 (Bureau) Credit rating agency CRISIL on Thursday forecast India’s gross domestic product (GDP) growth at 6% in fiscal 2024, down from 7% estimated by the National Statistical Organisation (NSO) for fiscal 2023. “A complex interplay of geopolitical events, stubbornly high inflation — and sharp rate hikes to counter that — have turned the global environment gloomier,” the agency said. On the domestic front, the peak impact of the rate hikes, 250 basis points since May 2022, which has pushed interest, rates above pre-Covid-19 levels, will play out in fiscal 2024, it said. According to the agency, consumer inflation is expected to moderate to 5.0% on average in fiscal 2024 from 6.8% in fiscal 2023, owing to high-base effect and some softening of crude and commodity prices.
A good rabi harvest would help cool food inflation, while the slowing economy should moderate core inflation, it said. The risks to inflation are tilted upward, given the ongoing heat wave and the World Meteorological Organization’s prediction that an El Niño warming event is likely over the next couple of months, the agency said. “India’s medium-term growth prospects are healthier. Over the next five fiscals, we expect GDP to grow at 6.8% annually, driven by capital and productivity increases. What is also good to see is the increasing sustainability footprint of capex,” Amish Mehta, Managing Director and CEO of CRISIL Ltd, said. “At present, nearly 9% of the infrastructure and industrial capex is green. We see this number rising to 15% by fiscal 2027. Down the road, the impact of climate risk mitigation will be felt across revenue, commodity prices, export markets and capital spending,” he said.