India Will Grow at 7.2% in 2017-18, Says World Bank

Indian finance minister Arun Jaitley attends a seminar on the Goods and Services Tax (GST) issues during the Vibrant Gujarat investor summit in Gandhinagar, India January 11, 2017. Credit : Reuters/Amit Dave/Files

New Delhi: The World Bank expects India, the fastest growing major economy in the world, to grow at 7.2% in the current fiscal and further up to 7.7% by 2019-20 on strong fundamentals, reform momentum and improving investment scenario.

“Economic activity ought to accelerate in 2017-18. GDP is projected to grow at 7.2% from 6.8% in 2016- 17. Growth increases gradually to 7.7% by 2019-20, underpinned by recovery in private investments,” World Bank said at the launch of ‘India Development Report’.

The report says demonetisation in November 2016 caused a slight disruption to India’s growth recovery, following a favourable monsoon last fiscal, but things seems to be getting better.

“India remains the fastest growing economy in the world and it will get a boost from its approach to GST which will reduce the cost of doing business for firms, reduce logistics cost of moving goods across states, while ensuring no loss in equity,” said Junaid Ahmad, World Bank country director in India.

The World Bank report says that the overall impact of GST on equity and poverty is likely to be positive.