ADB lowers growth projections for India, China

ADB lowers growth projections for India, ChinaThe Asian Development Bank (ADB) on Wednesday slashed its growth forecasts for India and China, citing weakening growth momentum in the two Asian giants.

In its Asian Development Outlook, the ADB lowered its growth projection for India to 5.6 per cent for the financial year of 2012-13, from its previous projection of 7 per cent.

For China, the bank lowered growth projection from 9.3 per cent to 7.7 per cent. For the financial year of 2013-14, the bank expects growth to recover to 6.7 per cent in India and 8.1 per cent in China.

Lowering its growth forecast for the two countries, ADB said, "The deceleration of the region's two giants - the People's Republic of China and India - in tandem with the global slowdown, is tempering earlier optimism."

The ADB also said that China and India accounted for considerable shares of world GDP and that the two economies had become more integrated into world trade. However Director General Biswajit Dhar of Research & Information System for Developing Countries argued that slowdown in Chinese economy posed a big impact on ASEAN region, but India was yet to have any considerable impact on the region's growth momentum.

Industrial output in India and China is expected to remain downcast in the current fiscal year, as exports will continue suffering due to weak demand from industrialised countries.