ADB cuts India's growth forecast to 7.4% for 2016-17

The Asian Development Bank has revised India's growth rate to 7.4% in 2016-17 from 7.6% estimated this year but said India will remain one of the fastest growing economies in the world. The multilateral lending institution had earlier forecast 7.8% for 2016-17.

On Wednesday, ADB's flagship publication Asian Development Outlook (ADO) also projected a rise in consumer inflation, mainly on account of the impact of salary hike of government employees and a likely mild pick-up in global oil prices.

"India's economy will see a slight dip in growth in FY16 (From April 1, 2016, to March 31, 2017). The economy will again accelerate in FY17 as the benefits of banking sector reforms and an expected pickup in private investment begin to flow," the ADB said.

The government estimates the growth to be between 7-7.75% in the next fiscal year.

"India is one of the fastest growing large economies in the world and will likely to remain so in the near term," said ADB's Chief Economist Shang-Jin Wei.