Fitch Boosts India's GDP Growth Forecast Amidst Trade Tensions

In a significant update, Fitch Ratings has adjusted India's GDP growth projection for this fiscal year to 6.9%, raising it from a previous estimate of 6.5%. The revision followed solid growth figures posted in the June quarter and buoyant domestic demand.

Fitch becomes the first global agency to raise India's GDP forecast amidst the wave of downward revisions earlier in the year due to global trade uncertainties. It pointed out the economic acceleration seen from the March to June quarters as a key reason for the optimistic outlook.

The ongoing trade tensions with the United States, marked by new tariffs on Indian imports, have created some economic uncertainty. However, Fitch remains hopeful that reforms in the Goods and Services Tax, effective from September 22, will bolster consumer spending and reinforce growth, though a slowdown is expected in the second half of the fiscal year.