GDP Growth Seen At 5% In FY20, Set To Recover To 5.5% In FY21 Says FICCI Economic Outlook Survey

The latest round of FICCI's Economic Outlook Survey puts forth the annual median GDP growth forecast for 2019-20 at 5.0%. While the median growth forecast for agriculture and allied activities has been put at 2.6% for 2019-20; the industry and services sector are expected to grow by 3.5% and 7.2% respectively during the current year. Growth is likely to improve to 5.5% in 2020-21 as per the projections.

Furthermore, a median forecast of 4.7% for GDP growth has been pegged at for the third quarter of 2019-20. The growth numbers for the third quarter are expected to be released by Central Statistical Organisation in the month of February 2020. The survey was conducted during the months of December and January 2019-20 amongst economists belonging to the industry, banking and financial services sector.

Concerns remain on external front with exports projected to contract in 2019-20. Merchandise exports are expected to decline by 2.1%, while imports are expected to decline by 5.5% during the year. Moreover, median current account deficit forecast was pegged at 1.4% of GDP for 2019-20. Moderation in global growth forecast, escalating geo-political tensions, and uncertainty around trade deal between US-China and BREXIT outcome still form major risk factors.

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