ADB trims India's GDP growth forecast to 5.1% in FY20

The Asian Development Bank (ADB) on Wednesday trimmed its forecast for India's economic growth in 2019-20 to 5.1 percent saying consumption was affected by slow job growth and rural distress aggravated by a poor harvest. In September, ADB forecast India's GDP to grow 6.5 percent in 2019-20 and 7.2 percent in the year thereafter.

"India's growth is now seen at a slower 5.1 percent in the fiscal year 2019-20 as the foundering of a major non-banking financial company in 2018 led to a rise in risk aversion in the financial sector and a credit crunch. "Also, consumption was affected by slow job growth and rural distress aggravated by a poor harvest," it said.

ADB said growth should pick up to 6.5 percent in the next fiscal year with supportive policies.