GST Council meet: Extension of compensation cess to states to be in focus

 

The much-anticipated 47th Goods and Services Tax (GST) Council meeting, with its attention on GST rate rebuilding and augmentation of GST remuneration cess, will presently perhaps be held in the principal seven day stretch of May, when the Union Finance Minister Nirmala Sitharaman gets back from her 10-day visit to the US in the wake of going to the World Bank-IMF meeting recently.

Among the numerous things on the Council's plan, the expansion of the GST remuneration cess to states could end up being an antagonistic issue assuming the public authority won't agree to the solicitation, given its vociferous interest from a few resistance rules states.

The states have asked the Center to broaden the five-year remuneration period under the GST regulation before its end by June-end. Any transition to expand the GST remuneration cutoff time, nonetheless, will require an alteration to the Indian Constitution, which should be taken up in the following parliamentary meeting in light of the fact that the Constitution's 101st amendment, states must be made up for quite a long time, beginning 2017....Read More

RBI likely to revise inflation outlook as it extends rate pause: Economists

 

India's national bank will probably raise its expansion standpoint this week to reflect costlier oil, however leave acquiring costs consistent and tap other strategy apparatuses it's utilized before to help an economy confronting new dangers to recuperation.
All financial analysts reviewed by Bloomberg expect the Reserve Bank of India's six-part money related strategy board of trustees to hold the benchmark repurchase rate at 4% Friday, while only three out of 27 surveyed as of Wednesday see a climb in the opposite repurchase rate.

That will move the concentration to any changes in language in the strategy explanation, as financial backers search for indications of normalizing money related settings.

This is what to look for in Governor Shaktikanta Das' discourse after the MPC meeting at 10 a.m. in Mumbai on Friday:

The critical important point from Das will be on how the RBI intends to help the public authority's 14.31 trillion rupee ($189 billion) obligation program, while holding the sovereign's acquiring costs under wraps when quicker worldwide approach standardization is pushing yields higher.

Keeping a top on costs is urgent for Prime Minister Narendra Modi's administration as it tries to support spending on framework, making position and expanding usefulness in the economy.

Assumptions are for the RBI to restore open-market activities or resort to Operation Twists, wherein it purchases longer securities and sells more limited dated notes, to supply support the market in the midst of record obligation. The two measures were utilized by the bank during the stature of the pandemic, in spite of the fact that merchants aren't expecting a declared buy plan.

MTaI seeks reduction in GST on medical devices, cold chain units

 

The Medical Technology Association of India (MTaI) has urged the government to reduce GST and customs duties on medical devices, cold chain units and spare parts used in the healthcare appliances in the upcoming Union Budget.

The organisation noted that the reduction of GST on medical devices and medical cold chain from 12 per cent to 5 per cent would lead to the expansion of the healthcare sector through reduced costs improving patient accessibility, MTaI said in a statement.

The organisation, which represents research-based medical technology companies, also sought streamlining of Customs Duty and GST on spare parts.

Currently, the custom duty and GST on spare parts of medical equipment are currently charged at a higher rate than the equipment itself, it added.

MTaI has also suggested amendment in the Health Cess ad valorem imposition by removing the word 'Ad-valorem' so that the cess is implemented on Basic Customs duty (BCD) rate only.

Read More on Budget 2021

Are you eligible for refund under interest waiver scheme? Check new rules

 

The legislature on Tuesday night gave 'as often as possible posed inquiries' on its plan to discount the accumulated dividends on credits by borrowers, during the advance ban time frame from March-August, 2020, following a continuous appeal in the Supreme Court.

The legislature explained that borrowers will be qualified for get a discount on a total whole of Rs 2 crore obtained from the financial framework, due for reimbursement during this period. Charge card contribution will likewise be qualified, the administration said.

Here are a couple of key features of the plan:

FOR BORROWERS

*All credit accounts with endorsed limits and extraordinary not surpassing Rs 2 crore as on 29.02.2020 will be qualified

*The qualification breaking point of Rs 2 crore as acquired entirety must be a total credit taken from the financial framework

*The bundle will be accessible for qualified borrowers regardless of if they have benefited or somewhat profited the ban on reimbursement reported by RBI

*Loan records ought to be standard in the books of the loaning establishments as of 29.02.2020 for example they ought not be non-performing resources

*The following kind of advance records will be qualified: MSME Loans, instruction advances, lodging advances, shopper solid advances, Visa levy, vehicle advances, individual advances to experts and utilization advances

• The charge card exceptional (for example settled sum) in the record as on 29.02.2020 will be the reference sum. Any charges/credits, which are not reflected in the record, won't be qualified

*However, advances against fixed stores [including Foreign Currency Non-Resident (Bank) {(FCNR(B)} record, bonds and other interestbearing instruments], and offers and so on, and credits given for interest in monetary resources (shares, debentures and so forth) are not qualified for inclusion under the plan

*The period for discount, on which the contrast between accruing funds and basic enthusiasm on advance records will be determined, will be from March 1, 2020 to August 31, 2020

*Borrowers won't need to apply to their loaning foundations and the accumulating funds discount will be credited into their financial balances naturally

*Non-reserve based cutoff points won't be incorporated for showing up at the qualification

*Even mostly dispensed credits will be secured under the plan

*Borrowers, who have shut their financial balances among March and August 2020, will likewise be qualified for a discount, which will be determined till the date of shutting of their records

*In case a financial balance is shut, the borrower needs to illuminate the bank about the equivalent and give elective ledger subtleties for crediting cash

Finance ministry asks departments, PSUs to expedite capital expenditure

Current Affairs

As part of the Modi government’s bid to boost economic activity and pump in liquidity into the infrastructure sector, senior finance ministry officials are meeting officials from other departments, as well as state-owned firms. The PSUs are being told to boost capital expenditure (capex), while the departments, especially those related to infrastructure sectors, are being told to expedite spending of allocated sums and release outstanding payments to contractors.
Economic Affairs Secretary Atanu Chakraborty and Expenditure Secretary Girish Chandra Murmu on Thursday met officials from the ministries of road transport & highways, railways, telecom, and housing & urban affairs to review their capex programme.The two secretaries, it is learnt, are expected to meet representatives of other infrastructure-related departments, as well as managing directors and senior officers of PSUs, on Friday.
“The departments are being told to clear pending payments to contractors, especially those in the micro, small & medium enterprises (MSMEs) sector. They will be directed to front-load their capex allocations, while PSUs are also being told to boost capex. The idea is to create more liquidity in the infrastructure sector,” said an official.
These capex reviews come just a day after Finance Minister Nirmala Sitharaman met representatives of the infrastructure sector — the latest of the many sectoral meetings she has had in the past one month.

The meetings came against the backdrop of India’s gross domestic product growth slumping to a six-year low of 5 per cent in the April-June quarter. Experts have pointed out that a capex boost focused on infrastructure by the private sector and the government is a way out of the slowdown as the Centre looks to create jobs...Read More

Govt may hive off Coal India into separate listed firms to raise funds

International News

India may spin off units of Coal India Ltd, the world's largest coal miner, into separate listed companies to boost competition and raise government funds, according to people with knowledge of the matter.
The state-run company and the coal ministry are studying a proposal by the finance ministry's Department of Investment & Public Asset Management to list four of Coal India's biggest production units, as well as its exploration arm, said the people, who asked not to be named as the plan isn't public. The development is in an early stage and it was unclear how long it may take, the people added.
Prime Minister Narendra Modi's government has sought to sell some state assets to raise funds, and these divestments will continue to remain a priority, Finance Minister Nirmala Sitharaman said July 5, setting a record target of raising Rs 1.05 trillion ($15 billion) in the current fiscal year. Spinning off Coal India subsidiaries would also lead to greater competition in the domestic coal market and improve corporate governance, the people said.
A spokesman at Coal India didn't respond to requests seeking comment, while press officials at the coal and finance ministries declined to comment.
The four units -- Mahanadi Coalfields, South Eastern Coalfields, Northern Coalfields and Central Coalfields -- account for more than three-fourths of the company's output, while constituting less than half of its workforce. The fifth unit would be Central Mine Planning & Design Institute.

 India's state run coal giant has been unable to meet growing demand despite abundant resources. Coal India produced a record 607 million metric tons in the last fiscal year to March, falling short by 22 per cent of a target proposed in 2017...Read More

Full text of Finance Minister Nirmala Sitharaman's Union Budget 2019 speech

Budget 2019

Finance Minister Nirmala Sitharaman Friday announced a slew of measures in her maiden Budget 2019-20 speech in the Parliament today. Among key announcement, Sitharaman said the government will launch an inter-opearable ATM-like One Nation One Card for pan-India travel, new rental laws for affordable housing, interest subvention scheme for MSMEs and women.
Here's what Finance Minister Nirmala Sitharaman said in her Budget 2019 speech:
The recent election which brought us to this august House today, was charged with brimming hope and desire for a bright and stable New India. Like never before, India celebrated its democracy by coming out to vote in large numbers, like never before. Voter turnout was the highest at 67.9%. Every section – young, old, first time voters, voters since the first General Election, women – all turned up to stamp their approval of a performing Government. Through their unambiguous and firm mandate they have reaffirmed “putting the nation first”. The people of India have validated the two goals for our country’s future: that of national society and economic growth.
The first term of Hon'ble PM Narendra Modi-led-NDA-Government stood out as a performing Government, a Government whose signature was in the last mile delivery. Between 2014-19, we provided a rejuvenated Centre-State dynamic, cooperative federalism, GST Council, and a strident commitment to fiscal discipline. We had set the ball rolling for a New India, planned and assisted by the NITI Aayog, a broad based think tank. We have showed by our deeds that the principle “Reform, Perform, Transform” can succeed.

 Mega programmes and services which we initiated and delivered during those 5 years will now be further accelerated...Read More

Budget 2019: Key takeaways of Nirmala Sitharaman's maiden budget speech

Budget 2019
Finance Minister Nirmala Sitharaman on Friday said that the country is well within its capacity to become a $5 dollar economy in the next five years.
Here are the key takeaways:

• From $1.85 trillion in 2014, the economy has reached $ 2.7 trillion

• We are well within our capacity to reach $ 5 trillion in the next few years

• Economy will grow to become a $3 trillion economy in the current year itself

• Reform, perform, transform

• India Inc is India's job creators

•   Between 2014 and 2019, we provided a rejuvenated centre-state dynamics, cooperative federalism, GST council and strident commitment to fiscal discipline.

Economic Survey bats for a 'rationalised' tax regime to boost start-ups

Budget 2019

Acknowledging the contribution of start-ups in growth of the economy and job creation, the Economic Survey batted for a “rationalised” tax regime and “predictability of policy action” for them in order to spur innovation and attract private investment.
The policy document, which was tabled in Parliament on Thursday, said the “outlook of the Indian economy appears bright with prospects of a pick-up in growth in 2019-20 on back of the pick up in private investment and robust consumption growth". It said the government is playing a proactive role in investment promotion through a liberal foreign direct investment (FDI) policy. During 2018-19, total FDI equity inflow stood at $44.36 billion as compared to $44.85 billion during 2017-18. According to government data, start-ups raised $7.5 billion in 2018, a majority of which was foreign capital, an increase of 74 per cent over the previous year. India now has 10 unicorn start-ups, collectively valued at over $35 billion, it said.
The Survey said that in order to further catalyse the growing ecosystem, taxation for start-ups must be rationalised.
“Tax policy and its implementation for start-ups must be rationalised to foster innovative investments in the Indian economy. Countries across the world recognise the need to evolve a tax system that can foster innovation.”

 It also suggested a re-look at capital gains tax, levied on profits from the sale of shares in unlisted companies. The high rate of capital gains tax in India — 30 per cent (for short-term holding) and 20 per cent (long-term holding) — has pushed some Indian start-ups to shift their headquarters abroad, mainly in Singapore where capital gains tax is nil. In this case, investors and promoters of these start-ups skip paying capital gains to India, resulting in a loss to the exchequer. It is also a deterrent to local M&As...Read More

Economic Survey 2019: Aadhaar-linked payments checked leakages

Budget 2019
In a bid to rev up the economy, the government might enhance the Start-Up fund in the Budget 2019-20.
According to highly-placed sources, the government is likley to come good on its poll promise of enhancing the fund to Rs 20,000 crore.
The Start-up India programme had created the 'Fund of Funds for Startups (FFS)' with a corpus of Rs 10,000 crore to provide support for Start-ups, over a period of XIV and XV Finance commission cycles.
The Fund was set up with the approval of Union Cabinet in June 2016 and is managed by Small Industries Bank of India (SIDBI) and contributes to the corpus of Alternate Investment funds (AIFs) for investing in equity and equity linked instruments of various start-ups.
Even the Economic Survey which was presented on Thursday highligthed the importance of the segment.
It recommended that the government rationalise the tax policy and its implementation for start-ups to foster innovative investments in the Indian economy.

 "Several studies have also suggested that capital gains tax can have significant economic consequences for individual investors in terms of its lock-in effects and associated deterring incentives to use capital gains into riskier investments," the survey said...

Investment-driven growth model must have aggressive export strategy: Survey

Budget 2019

Any investment-driven growth model must have an aggressive export strategy, the government said in its Economic Survey of 2018-2019.
The onus of rescuing economic growth has been placed squarely on exports, since the share of consumption in gross domestic product (GDP) remains constrained by a high level of savings, the Survey said. Goods exports rose 8.8 per cent in 2018-19, after a 10 per cent rise in the previous year.
However, it mentioned weak exports growth in 2019-20 as a key downside risk to the economy, taking note of continuing heightened US-China trade tensions. The Survey sounded a stark warning that prospects of export growth remain weak for 2019-20 if status quo is maintained.
The World Economic Outlook in its April 2019 issue had projected growth in world output at 3.3 per cent in 2019, down from 3.6 per cent in 2018.
Rupee devaluation
The Survey pointed out that the desired export growth required to deliver the 8 per cent real GDP growth rate may require a depreciation in the real effective exchange rate. "But we emphasise export growth stemming from increases in productivity rather than currency depreciation," the Survey countered. However, the government stressed that a higher growth rate for exports has been seen in Rupee terms due to the depreciation of the currency, while that of imports declined in 2018-19.

 In view of the demand by industry to re-assess India's existing free trade agreements (FTA), the Survey noted that India's imports from FTA nations have been on the rise, accounting for 52.0 per cent of India’s total imports. On the other hand, exports continue to trail. Outbound trade with trade partners accounted for 36.9 per cent of total exports.

Govt my enhance start-up fund to Rs 20,000 cr in Budget 2019: Sources

Budget 2019

In a bid to rev up the economy, the government might enhance the Start-Up fund in the Budget 2019-20.
According to highly-placed sources, the government is likley to come good on its poll promise of enhancing the fund to Rs 20,000 crore.
The Start-up India programme had created the 'Fund of Funds for Startups (FFS)' with a corpus of Rs 10,000 crore to provide support for Start-ups, over a period of XIV and XV Finance commission cycles.
The Fund was set up with the approval of Union Cabinet in June 2016 and is managed by Small Industries Bank of India (SIDBI) and contributes to the corpus of Alternate Investment funds (AIFs) for investing in equity and equity linked instruments of various start-ups.
Even the Economic Survey which was presented on Thursday highligthed the importance of the segment.
It recommended that the government rationalise the tax policy and its implementation for start-ups to foster innovative investments in the Indian economy.

 "Several studies have also suggested that capital gains tax can have significant economic consequences for individual investors in terms of its lock-in effects and associated deterring incentives to use capital gains into riskier investments," the survey said.

Indian fund managers see earnings revival, eye opportunity in consumption

517398871

Budget 2019

Indian wealth and alternative investment managers expect the next federal budget to propose measures that will improve consumption and bolster infrastructure to revive economic growth.
Newly appointed Finance Minister Nirmala Sitharaman will present her first budget on Friday. Growth slowed to a five-year low of 5.8 per cent in the first three months of 2019, amid a liquidity crunch at non-banking financial companies. That’s put pressure on recently re elected Prime Minister Narendra Modi to deliver on a stimulus plan.
Here’s a roundup of views from fund managers on current opportunities in the market:
Nalin Moniz, chief investment officer, alternative equity, Edelweiss Asset Management Ltd.
Liquidity conditions are slowly normalizing; the cash squeeze should normalize in 1-2 quarters.
Expect to see a broad-based revival in earnings in the latter half of FY20.
Sees opportunities in consumption, exports and financial services sectors on a 5-year horizon.
Over the longer term, both consumer goods and discretionary consumption are expected to boom as the Indian economy grows from $2.7 trillion toward $5 trillion.Nifty’s current valuations are incomparable to the past, as index’s composition has shifted from manufacturing toward financials.
Vijay Krishna Kumar, head of liquid alternative investment, IDFC Asset Management Co.

The budget will be another non-event accounting exercise.

Budget likely to raise military spending slightly, delaying modernisation

Budget 2019

The government is likely to stick to a modest rise in defence spending in the 2019/2020 budget due on Friday because of government finances, officials said, further delaying a long-planned military modernisation programme.
India's air force desperately needs hundreds of combat planes and helicopters to replace its Soviet-era aircraft while the navy has long planned for a dozen submarines to counter the expanding presence of the Chinese navy in the Indian Ocean.
The army, a large part of which is deployed on the border with traditional foe Pakistan, has been seeking everything from assault rifles to surveillance drones and body armour.
But these plans have been on hold for years because governments have not been able to set aside large sums and most of the defence expenditure goes on salaries and pensions for a 1.4 million standing military, the world's second largest after China.
In an interim budget announced in February before national elections, the government allocated Rs 4.31 trillion ($62.27 billion) for defence, a 6.6 per cent rise over the previous year, raising concern at the time it wouldn't be enough for modernisation.
But a finance ministry official told Reuters there was unlikely to be any change to that allocation when Finance Minister Nirmala Sitharaman presents the federal budget in parliament.

 "Defence is our major spending and we give it as much as the budget allows. But this year, a significant rise to what has already been allotted looks difficult," the official involved in the budget preparations said.

Budget 2019: Govt may cut taxes on biz, hike spending for economic growth

Budget 2019

Prime Minister Narendra Modi's government on Friday will unveil a budget that is expected to cut taxes on business and raise spending in a bid to shore up consumption and faltering economic growth.
Analysts say Modi, boosted by a sweeping election victory, hopes to use the budget to restart reforms and deal with a series of economic woes.In January-March, annual growth slumped to 5.8%, the slowest pace in 20 quarters. Growth for the financial year that ended in March was 6.8%, also a five-year low, and indicators such as plummeting industrial output and automobile sales have stoked fears of a deeper slowdown.
A shortfall in monsoon rains, pivotal for the farm sector that employs nearly half of India's workers, has increased concerns of rural distress and strengthened the case for intervention, a leader of Modi's ruling Bharatiya Janata Party (BJP) said."The focus of the budget will be to boost domestic consumption, address the rural crisis and support small manufacturers," Gopal Krishna Agarwal, BJP's economic affairs spokesman, told Reuters.
Shilan Shah at Capital Economics in Singapore said in a note "Given the recent economic slowdown, the finance minister is likely to announce more accommodative tax and spending measures."In February, then-Finance Minister Piyush Goyal presented an interim budget for the year beginning April 1, to maintain government functions while a weeks-long election was under way.
BIG INVESTMENT PLANS

 On Friday new minister Nirmala Sitharaman will present a full-year budget that Agarwal said could lower corporate taxes for small and medium-sized businesses as well as personal ones to revive consumption by the middle class that gave Modi a second term,while withdrawing some tax exemptions.

Budget 2019: The toughest balancing act for India's new finance minister

Budget 2019

India’s first female finance minister in almost five decades, Nirmala Sitharaman, has held a wide range of jobs: She rode aboard a fighter jet as defense minister. As head of the trade department she grappled with falling exports. She’s been a national spokeswoman for her party, and in younger days worked in London as a home decor saleswoman.
Now Sitharaman, 59, faces what might become one of the toughest balancing acts of her career. On May 31, within hours of her arrival at her new office in New Delhi, she was greeted with India’s worst economic news of the year: Unemployment had touched a 45-year high, and India had lost its tag of the world’s fastest-growing major economy to China in the last quarter of the fiscal year.
On July 5, Sitharaman makes her first major public appearance in her new role, presenting India’s budget at a time when she’s under pressure to spend more to reinvigorate the economy. She must find resources for welfare programs announced by Prime Minister Narendra Modi’s government, including 870 billion rupees ($12.6 billion) for a new measure to support farmers. And she must do all that while keeping the national deficit below 3.4% of GDP, a target credit rating companies are watching closely.
A surprise pick by Modi, the new minister remains a relatively unknown entity to the financial world. Her critics say there’s a risk she could simply become a figurehead, with polices shaped by the prime minister. Her supporters argue that her reputation for prudence and team spirit will help her work out a middle ground.

 “It is difficult to predict what Minister Sitharaman will do in her new role as finance minister,” said Richard Rossow, senior adviser at the Center for Strategic and International Studies in Washington. “She will need to balance fiscal prudence with Modi’s desire to continue expanding key social programs like subsidized cooking gas and electric power access.”

Budget wishlist: Scrap recycling sector seeks cut in import duty, GST

Budget 2019

The metal recycling industry has urged the government pare the import duty on metallic scrap, its sole raw material, to nil from the existing 2.5-5 per cent.It also wants a reduction in goods and services tax (GST) to five per cent from the existing 18 per cent, in order to provide a level playing field with domestic primary metal producers who enjoy duty-free import of finished products under the Free Trade Agreement (FTA) with various countries.
In a pre-Budget submission to Union Finance Minister Nirmala Sitharaman, the apex industry body, Metal Recycling Association of India (MRAI) president Sanjay Mehta, said, "Since India doesn't generate enough metal scrap, the demand for the same has to be met through import. Most countries in the world Sri Lanka, Nepal, Thailand, Malaysia, Indonesia, Japan etc. have reduced import duty on imported scrap to nil. India remains the only country with an import levy of 2.5-5 per cent on metallic scrap despite the fact that its import conserves domestic natural resources, saves energy and also generates employment."
While import of iron and steel, copper and aluminium scrap currently attracts import duty of 2.5 per cent, brass and zinc scrap suffers five per cent of import tax in India.
At the same time, the government has encouraged primary producers by exempting copper concentrate, the raw material, from import duty. Apart from that, finished products of these ferrous and non-ferrous metals are also imported duty-free under the free trade agreements (FTAs) signed with ASEAN and other countries to boost regional and bilateral co-operation.

 India being deficient in copper concentrate but rich in bauxite for aluminium production, the government has encouraged primary producers in both metal segments at the cost of secondary producers, who contribute nearly half of India's overall non-ferrous metal demand...Read More

Budget 2019: After election, it's Modi's key chance to spur waning economy

Budget 2019

Prime Minister Narendra Modi has his first chance since a decisive election win to spur an economy that’s quickly lost its status as the world’s fastest-growing major one.
Newly appointed Finance Minister Nirmala Sitharaman is expected to boost spending and provide tax relief to consumers in her maiden budget on Friday. That will probably widen the budget gap to 3.5% of gross domestic product in the year started April 1 from 3.4% targeted in February’s interim spending plan, according to a Bloomberg News survey.
Growth slowed to a five-year low of 5.8% in the first three months of 2019 -- well below China’s 6.4% expansion -- putting pressure on Modi to deliver on a stimulus plan to kickstart consumption, a bedrock of the economy. With the global outlook turning gloomy amid heightened trade tensions, and the Reserve Bank of India already cutting interest rates three times this year, the focus is shifting to the government to play its part.
“For the next budget exercise, the development goal might supersede the rigid objective of fiscal austerity,” said Soumya Kanti Ghosh, group chief economic adviser at State Bank of India in Mumbai. “Sticking to a particular fiscal number is not that important in the current scenario.”Sitharaman will need to balance allowing the budget deficit to widen without risking a credit-rating downgrade and rattling bond markets. Key to that will be finding additional revenue to finance higher spending and keeping borrowing under control.
Here are other key things to watch for in the budget:

Taxes : Revenue from consumption taxes and customs levies undershot targets last year, and Sitharaman will need to find additional resources to fund welfare programs without increasing the tax burden on individuals.

Fastest growing economy? India to grow at 7.5% in FY20, says World Bank

Current Affairs

As Finance Minister Nirmala Sitharaman prepares her budget, the World Bank reports Indias economy grew by 7.2 per cent in 2018-19 in contrast to the recent Indian Central Statistical Office (CSO) estimate of only 6.8 per cent growth during the period.
The Bank's Economic Prospects Report released on Tuesday forecast India's economy to grow by 7.5 per cent during this and the next two fiscal years, retaining its top spot as the fastest growing major economy. It would be helped by a "more accommodative monetary policy" and low inflation, it said.
The report retained the forecasts it made in January for India.
India's growth forecast is the brightest spot in a grim forecast for the world economy. The report said that the global growth rate was estimated at 3 per cent last year and is forecast to dip steeply to 2.6 per cent this year, before edging up to 2.7 per cent next year and 2.8 per cent in 2021.
India "is estimated to have grown 7.2 per cent in fiscal year 2018-19, which ended March 31", the report said. "A slowdown in government consumption was offset by solid investment, which benefited from public infrastructure spending".
The Bank said that the cut-off dates for data used in the report was May 23.
On May 31, the CSO said that India's gross domestic product (GDP) growth during the 2018-19 fiscal stood at 6.8 per cent, lower than the previous year's 7.2 per cent.The CSO said the Indian economy grew by only 5.8 per cent in the fourth quarter. That dragged down the fiscal year's growth rate.

 Finance Secretary Subash Garg attributed the slowdown to "temporary factors like stress in non-banking financial company (NBFC) sector affecting consumption finance".