The Economic Survey today forecast a GDP between 6 to 6.5 per cent for 2020-21, while peging the FY 2020 GDP at 5%. The number was largely in line with what most analysts had estimated and suggests that the tepid economic growth would continue into the next year.
The Economic Survey noted that there was a need to relax the fiscal deficit this year, while the next year the fiscal deficit could pose a challenge. For the current year, the fiscal deficit has been targetted at 3.3 per cent of GDP, which is unlikely to be met.
Most of the top agencies, including the IMF, Fitch, Moody's and several others had cut India's GDP for 2019-20. The growth outlook for 2020-21 too does not look very encouraging.
Meanwhile, the markets failed to react to the tepid growth outlook, given that it was largely anticipated. The Sensex was last seen trading with losses of 99 points, while the Nifty was down 42 points. All eyes are expected to be on the Union Budget slated for tomorrow.