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April 02, 2008 13:47 IST
Last Updated: April 02, 2008 14:02 IST
ADB on Wednesday projected India's growth rate to moderate to 8 per cent in 2008-09, from 8.7 per cent last fiscal. This projection came as the Reserve Bank of India [Get Quote] maintains tight monetary policy and the government takes measures to rein in inflation ahead of Parliamentary elections early next year.
However, India's economy will rebound to 8.5 per cent in 2009-10, Manila-based Asian Development Bank [Get Quote] said in its Asian Development Outlook 2008.
Narhari Rao, principal economist with India Resident Mission of ADB, said recent duty cuts by the government to arrest inflation, which is racing towards 7 per cent, are likely to show results in 2-3 weeks.
However, the government might have to increase subsidies in some food items, like rice and wheat, to soften their prices as global prices are quite high and import duty cannot be reduced below zero, Rao said.
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