In its report titled "Global Macro Outlook 2014-15: Summer Lull: Subdued, but less risky global growth Likely', global rating agency, Moody’s has projected a better growth outlook for India and forecasted country’s GDP to grow by 5% this year. The higher growth projection for India comes against the backdrop of a new government coming to power with single majority for the first time in three decades.
The agency has held robust growth outlook for both Indonesia and India and expects both the countries’ GDP to grow around 5% this year and 5.5%-5.6% in 2015. However, the rating agency’s forecast on country’s growth forecast still remained way lower than the level witnessed before global crisis. Besides, it is also short of new government’s target to raise the growth of 7.8% by 2017-18. Further, Moody's also expects India and Indonesia to see more resilient GDP growth.
Specifically for India, the agency highlighted global slowdown along with sluggish domestic economic activities, high interest rates and stubborn inflation were some of the factor that pulled down India's growth to sub 5% in the last two years. After recovering in 2009-10 and 2010-11, GDP growth sunk to decade's low of 4.5% in 2012-13 and marginally picked up to 4.7% in 2013-14.