Macroeconomic challenges continue.
Despite steps to tighten fiscal and monetary policies to rein in high and unsustainable twin deficits.
To meet its large financing needs government discussing program with the IMF
In addition arranging financial assistance and oil credit facilities from bilateral sources
Continued fiscal consolidation in FY2020 will keep growth subdued at 3.6% supply side is already showing signs of slowdown
Agriculture is expected to underperform.
Target of 3.8% growth target for FY2019 appear unachievable after water shortages.
Large-scale manufacturing reversed 6.6% growth in the first half of FY2018 to decline by 1.5% in the same period of FY2019 domestic demand contracted and rising world prices crimped demand for raw materials
Contraction hit all key categories, including a 0.2% decline in textiles domestic demand shrinks will keep growth in services subdued.
Reform package announced in January 2019 is expected to support agriculture
With exchange rate flexibility and declining imports, net exports are expected to contribute to growth.