Prompted by ongoing global financial turmoil and weakened investment outlook, the Asian Development Bank today lowered India’s economic growth forecast for the current financial year (2008-09) to 7.4 per cent from earlier projection of 8 per cent.

“The change in the global economic environment and the policy adjustments needed to maintain macroeconomic stability prompt a downward revision of growth forecast to 7.4 per cent in FY 2008 and to 7 per cent in FY 2009,” the multilateral lending agency said in its update of Asian Development Outlook 2008.

The revision in growth forecast “stems from a weakened investment outlook,” it said.

Meanwhile, China’s economic growth is expected to slump to 10 per cent this year and dip further to 9.5 per cent next year, the bank said.