World Bank likely to revise India's FY16 GDP growth forecast

The World Bank may revise its GDP growth projection for India for the current fiscal, after it goes for a stock-taking in a few months, the bank's chief economist Kaushik Basu indicated today.

"There could be some changes in the January review of India's growth forecast for the current fiscal," Basu said.

He was responding to media queries whether failure of the government to get the GST bill passed would have an impact on the projection. Although he did not specifically state the bank's views on GST implementation, he indicated that the projections have also been based on a possible tax transformation in the economy.

"Decision-making and reforms can have an impact in terms of growth rate and the fact that a couple of important decisions did not go through could have an impact. But India is dominating for a couple of reasons," Basu said in Kolkata. 

Until October, the World Bank had retained its growth forecast at 7.5 per cent for 2015-16. The India Development Update of the global development lender also expected India's growth at 7.8 per cent in 2016-17 and at 7.9 per cent in 2017-18.

This projection was subject to investment rate picking up along journey. However, Basu said the general mood has been positive which helped the investment climate.

Basu said recession in Brazil and Russia and slowdown in China made India the leading economy in terms of growth prospects for the first time this year.