Growth takes a back seat: RBI sharply cuts GDP forecast to 5% from 6.1%

Says forces driving up inflation 'appear to be transient'

The Reserve Bank of India (RBI) on Thursday reduced its annual economic growth forecast to 5 per cent, from 6.1 per cent it predicted in October. 

In its December 2018 meet, the monetary policy committee (MPC) had predicted that gross domestic product (GDP) would grow at 7.5 per cent in FY20. This indicates an admission of the severity of the current economic slowdown by the central bank.

But more importantly, Governor Shaktikanta Das indicated that the onus to arrest the slowdown lies in the fiscal policy and that the “government may initiate some more counter-cyclical fiscal and other measures to