New Delhi: Fitch Ratings on Monday said India is expected to clock a GDP growth of 5.6% in the next financial year, lower than the projection made by the government's Economic Survey, as Budget 2020 has not "materially altered" its view on the country's growth outlook.
The Economic Survey, released a day before Finance Minister Nirmala Sitharaman presented Union Budget for 2020-21 on February 1, had projected a GDP growth of 6-6.5%, up from 5% estimate for 2019-20.
"The fiscal slippage announced in the government's new FY21 budget is modest relative to its previous targets, and is consistent with our expectations when we affirmed India's 'BBB-' rating with a stable outlook last December, given slowing growth momentum," said Thomas Rookmaaker, Director and Primary Sovereign Analyst for India, Fitch Ratings.
Sitharaman's Budget missed deficit target for the third year in a row, pushing shortfall to 3.8% of GDP in the current fiscal as compared to 3.3% previously planned. The fiscal deficit target for the coming fiscal year starting April 1, has been fixed at 3.5%.
India's high public debt relative to peers is a rating weakness, it said.