Home / Knowledge / News / Textiles / India's real GDP growth in FY20 to be below 5%: IHS Markit

India's real GDP growth in FY20 to be below 5%: IHS Markit

Dec '19
Pic: Shutterstock
Pic: Shutterstock
India's real gross domestic product (GDP) growth in 2019-20 is likely to be a bit lower than 5 per cent as stimulus measures will take time to show results, IHS Markit said. Financial sector fragilities continue to weigh in on growth momentum, with high level of non-performing loans on the balance sheets of public sector banks, constraining new lending, it said.

Furthermore, there are also risks from potential contagion effects from troubled non-bank financial companies (NBFCs) to the balance sheets of some commercial banks, which could further weigh in on the overall pace of credit expansion, IHS Market said in a recent report.

"Following the weak GDP outturn for the September quarter, Indian real GDP growth in FY 2019-20 is expected to be slightly below 5 per cent, as it is anticipated that the impact of stimulus measures will take time to filter through to the real economy," a news agency reported citing the IHS document.

Latest GDP data for July-September quarter showed a significant further moderation in the pace of economic growth to 4.5 per cent, the weakest in six years with a key contributory factor being a slump in manufacturing output.

"Confronted with the sharp slowdown in economic growth momentum, the Indian government will face increasing pressure to roll out additional fiscal measures to bolster manufacturing output and kick-start an upturn in the investment cycle. Such measures could include accelerated government spending on infrastructure projects such as roads, railways, and ports, as well as urban infrastructure such as affordable housing and hospitals," it said.

IHS said given that the process of strengthening bank balance sheets has been slow, taking a number of years already, India's financial sector problems are likely to remain a drag on the pace of economic growth over the medium-term outlook.

"Furthermore, any turnaround in the investment cycle could also be relatively protracted, depending on the ability of the government to accelerate its own infrastructure spending program," it said.

A key concern is also the sharp contraction in capital goods output, which was down 20.7 per cent in September 2019.

"This indicates that India's investment cycle is experiencing a severe cyclical slowdown, as reflected in the further slowing of fixed investment growth during the September quarter," it said. "The construction sector growth also slowed to a pace of 3.3 per cent in the September quarter, compared with growth of 5.7 per cent in the June quarter," it added.

Fibre2Fashion News Desk (DS)

Must ReadView All

Pic: Shutterstock

Textiles | On 25th Jan 2020

EU, 5 African nations start talks to deepen trade ties

The European Union (EU) recently concluded the first round of...

Pic: Shutterstock

Apparel/Garments | On 25th Jan 2020

Pak-PRC textile cooperation to focus on readymade garments

Chinese and Pakistani experts have agreed to forge a textile...

Pic: Shutterstock

Textiles | On 25th Jan 2020

India's GDP expected to grow at 5.5% YoY in FY21: IndRa

India's gross domestic product is expected to grow at 5.5 per cent...

Interviews View All

Divyesh Mashruwala, Akshar Industries

Divyesh Mashruwala
Akshar Industries

Surat dominates foiling, embossing and pleating

Top executives, Retailers

Top executives

Weak rupee breeds inflation

Jurgen Gauger, Spreadshirt

Jurgen Gauger

‘Buying crowdsourced or creative designs are much more appealing to the...

Larry Fontana,

Larry Fontana

Italy-based Lafer SpA is one of the most innovative surface finishing...

Shyam Gupta & Ravi Gupta,

Shyam Gupta & Ravi Gupta

Based out of South Delhi, Gargee Designer's provides bespoke formal and...

Jash Choraria,

Jash Choraria

Established in 2015 by <b>Jash Choraria</b>, Unifynd is a Mumbai-based...

Thomas Ong P S, NanoTextile

Thomas Ong P S

Malaysian company NanoTextile Sdn Bhd taps into the potentials of...

Eamonn Tighe, Nature Works LLC

Eamonn Tighe
Nature Works LLC

Eamonn Tighe, Fibres and Nonwovens - Business Development Manager of...

Andreas Lukas, Andritz Nonwoven

Andreas Lukas
Andritz Nonwoven

With forces in engineering and process development, Andritz Nonwoven...

Amiben Shroff, Shrujan

Amiben Shroff

From its modest beginning in the late 1960s, Shrujan has grown into a...

Priya Somaiya, Usha Social Services

Priya Somaiya
Usha Social Services

The Usha Silai label from Usha International is all set for a retail...

Aneeth Arora, Péro

Aneeth Arora

The Woolmark Company has partnered with handmade fashion label Péro and...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies


Leave your Comments

January 2020

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

Advanced Search