ADB cuts Asia growth forecast over Indian demonetisation
Manila, Dec 13 (IANS) The Asian Development Bank on Tuesday lowered Asia’s growth forecast for 2016 from 5.7 to 5.6 per cent due to a slight slowdown in the Indian economy.
The Manila-headquartered ADB’s review said the shortage of cash following Prime Minister Narendra Modi’s decision to demonetise Rs 1,000 and Rs 500 notes was one of the reasons for India’s 2016 economic growth to be 7 per cent instead of the earlier estimated 7.4 per cent.
ADB also highlighted weak investments and slow down in the agriculture sector in India as other reasons for the fall, Efe news reported.
It, however, said the Indian economy will recover in 2017 with an estimated growth of 7.8 per cent while the Asian continent will be at 5.7 per cent and was expected to remain stable in the coming year.
“Asian economies continue their robust expansion in the face of global economic uncertainties,” said ADB Deputy Chief Economist Juzhong Zhuang.
“Structural reforms to boost productivity, improving investment climate and supporting domestic demand can help maintain growth momentum,” he said.