RTTNews - India's economic growth will be impacted adversely by delay in the onset of the monsoon, causing higher inflation, reports PTI citing Moody's predictions. The rating agency also said though there would not be a sudden and widespread disaster, but the economy would suffer significantly with negative implications on economic growth. The report was quoting Moody's economy.com economist Sherman Chan.
He said that the downside effect of monsoon's delay would be evident in the agricultural component of the GDP data. Agricultural output represented less than 20% of the country's GDP compared with service-related sectors which were accounting for more than its half. However, he said, there would be spillover effects on other sectors. A slump in agricultural output would hurt the income of some businesses and households that, in turn, would weigh on business investment and household consumption. Thus, service-related sectors might also get affected, added Chan.
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