The Indian economy is in good shape as the country's GDP growth rate and foreign exchange reserve are high, PTI reported former RBI Governor Bimal Jalan saying so on April 7.
Jalan said, as per the report, that the ongoing Ukraine war was not going to impact India much even as it is impacting the global supply chain.
"India's current macroeconomic situation is quite positive in the sense that the rate of growth is high. India's foreign exchange reserve is also very high," he told PTI in an interview.
"Russia-Ukraine crisis will have an impact all over the world. But so far India is concerned, its relationship with Russia was quite good but exports-imports was not very much," Jalan said, as per the PTI report.
Meanwhile, the ministry of finance has raised concerns over the soaring commodity prices due to the Ukraine war which has aggravated the risk of the twin challenges of high inflation and slow growth for the country.
Quoting the Monthly Economic Review released by the ministry of finance on April 7, Mint reported that soaring global commodity prices and disruptions in supplies due to the Russia-Ukraine conflict pose a twin challenge to the Indian economy—growth may slow down while inflation could remain elevated.
Many rating agencies have lowered India's FY23 growth forecast owing to the high inflation and crude oil shock led by the Ukraine war.
ICRA has reduced its forecast of the year-on-year (YoY) growth of the Indian GDP in the financial year 2022-2023 (FY23) to 7.2 percent from 8 percent.
India Ratings and Research (Ind-Ra) has also lowered India's GDP forecast for the financial year 2022-2023 (FY23) to 7-7.2 percent from 7.6 percent earlier.
Fitch Ratings has also lowered its growth forecast for India for FY23 to 8.5 percent (-1.8pp) on sharply higher energy prices.
Morgan Stanley has also slashed India's economic growth forecast by 50 basis points to 7.9 percent for the financial year 2022-23.
The Asian Development Bank (ADB) on April 6 projected India’s economy to expand by 7.5 percent in 2022-23 and by 8 percent in the following year led by strong investment growth.
