Global ratings agency Fitch Ratings in December lowered India’s economic growth forecast to 4.6 per cent in 2019-20 due to domestic factors, in particular a squeeze in credit availability from non-banking financial companies (NBFCs), and deterioration in business and consumer confidence. According to Fitch, growth is expected to be around 4.6 per cent this fiscal against an earlier estimate of over 5 per cent. “Our outlook on India’s GDP growth is still solid against that of our peers, even though growth has decelerated significantly over the past few quarters, mainly due to domestic factors, in particular a squeeze in credit availability from NBFCs and deterioration in business and consumer confidence,” the Fitch report said.

“Fitch expects growth to slow to 4.6 per cent in the financial year ending March 2020 (FY20), from 6.8 per cent in FY19, which is still higher than the ‘BBB’ median of 2.8 per cent. We expect growth to gradually recover to 5.6 per cent in FY21 and 6.5 per cent in FY22 with support from easing monetary and fiscal policy and structural measures that may also support growth over the medium term,” it added.