The World Bank has maintained its growth forecast for India in 2015-16 at 7.5 per cent, while lowering marginally the projection for 2016-17 to 7.8 per cent, and for 2017-18 to 7.9 per cent. The World Bank says India, now the world’s fastest growing economy, is relatively well-positioned to weather the global volatility and even set for a modest acceleration in growth in the years ahead.

The earlier bi-annual update, released in April, had estimated gross domestic product (GDP) growth at 7.9 percent next fiscal and at 8 percent in 2017-18. According to the World Bank, resources from lower subsidies and higher taxes has been well utilized in lowering deficits and increasing capital expenditure.

Noting that India had lost market share in exports, the report said although the country may be able to achieve fast GDP growth without export growth for a short period, sustaining high rates of GDP growth over a longer period will require a recovery of export growth. The softer oil prices together with the structural reforms has also given a boost to domestic demand and allowed India to achieve faster growth despite sluggish exports.

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