The country’s GDP growth will accelerate to 7.5 per cent this financial year, from 6.6 per cent in the last fiscal, on better performance from the industrial and agricultural sectors. Headline inflation, lending rates, fiscal prudence, current account deficit (CAD) and exchange rates, however, are the areas of concern, the report by Care Ratings said. The report, however, said that the NPA-saddled banking sector will have an “upward bias” with credit growth estimated to go up to 12 per cent and deposits to swell by 10 per cent, it said, adding NPAs will be a “major challenge” for lenders. The agency feels meeting the wider 3.3 per cent target on the fiscal deficit will be difficult and adherence will depend on achievement of the Rs.80,000-crore divestment target, GST collections and tax receipts.

(Financial Express)