India's economic growth rate to grow at 7.4% in current financial year: RBI

The Reserve Bank expects India's economic growth rate to grow at 7.4 per cent in the current financial year on pick up in industrial activity and good monsoon.

RBI releasing its annual report in Mumbai yesterday said due to the evolving economic conditions, real GDP growth for 2018-19 is expected to increase to 7.4 per cent from 6.7 percent in the previous year.

The RBI said its monetary policy will continue to be guided by the objective of achieving the medium term target for retail inflation of four per cent. Agricultural production is likely to remain strong, growth in industry are strengthening and all other major sectors are reporting robust sales and improvement in profitability. 

The prevailing negative credit-to-GDP



gap indicates that there is sufficient scope for credit absorption and expansion in bank lending on a sustained basis.

The Reserve Bank of India expects India’s economic growth rate to accelerate to 7.4 percent in the current financial year on pick up in industrial activity and good monsoon. In its annual report, released yesterday, RBI also said that its monetary policy will continue to be guided by the objective of achieving the medium term target for retail inflation of 4 percent, while supporting the growth. The report notes that agricultural production is likely to remain strong. It had indicated that headline inflation may face upside risks in the remaining portion of the year.  The RBI has also warned against rising bad loans.