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India govt forecasts slower economic growth in year to March

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NEW DELHI: India's government expects economic growth to slow in the financial year ending March, as pandemic-related distortions ease and pent-up demand for goods slows going into 2023.


Gross domestic product (GDP) will likely rise 7 per cent this fiscal year, compared with 8.7 per cent the previous year, the Ministry of Statistics said in its first estimate for the period.


The preliminary projection is much lower than the government's earlier forecast of 8 per cent-8.5 per cent, but above the central bank's projection of 6.8 per cent.


The government uses the advanced GDP estimates as a base to work out its economic growth and fiscal projections for the next budget due on February 1.


February's will be the last full budget before Prime Minister Narendra Modi is expected to bid for a rare third term in elections due in summer 2024.


India's economy rebounded after Covid-19 restrictions were eased around mid-2022, but the war in Ukraine has spurred inflationary pressures, prompting the central bank to reverse the ultra-loose monetary policy it adopted during the pandemic years.


It has raised key interest rates by 225 basis points since last May to 6.25 per cent, the highest in three years, and another modest hike is expected early this year.


VIRTUAL SUMMIT: India will host a virtual summit of around 120 developing countries next week, its foreign minister said on Friday, as the country looks to bolster international cooperation during its presidency of the Group of 20 (G20) biggest economies.


The summit comes following a declaration by Prime Minister Narendra Modi in December that India's G20 priorities will be shaped in consultation with developing countries and its G20 partners.


"India has always been in the forefront and consistently championed the cause of the developing world," Foreign Secretary Vinay Kwatra told reporters, adding that the Covid-19 pandemic, climate change and the conflict in Ukraine had impacted many developing countries.


Heads of governments, foreign ministers and finance ministers will participate in the "Voice of Global South Summit" where discussions will range from financial development to energy security in developing nations, Kwatra said.


More than 120 invites have been sent for the two-day summit scheduled for Jan. 12-13 and a confirmed list of participating countries will be shared later, Kwatra said.


"Often the concerns of the developing world do not receive due attention and space on the global stage," he said.


"India's ongoing presidency of the G20 presidency provides us with a special and strong opportunity to channelise these inputs into the deliberation and discourse of the G20."


At the end of the summit, a summary detailing priorities and perspectives of the developing countries will be shared, Kwatra added. - Reuters


(Reporting by Aftab Ahmed; Editing by Jon Boyle and John Stonestreet)


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