New Delhi: India’s economic growth rate is expected to remain subdued at 7 per cent during the current fiscal, mainly on account of the impact of continuing global crisis, the Asian Development Bank (ADB) said on Wednesday.

The Asian Development Outlook (ADO), ADB's flagship report, said the Indian economy will only register a moderate increase in growth rate in the current fiscal, up from 6.9 per cent a year ago, and the country would need to push reforms and increase investments to achieve higher economic expansion.

The ADB's growth projection at 7 per cent for 2012-13 is lower than government's forecast of 7.6 per cent.

 As regards developing Asian region, the ADO said that economic growth in the region would decline to 6.9 per cent from 7.2 per cent in 2011-12, on account of continued uncertainty in eurozone and slump in global trade.

The ADO also highlighted the growing income inequality in the developing Asian countries including India and cautioned that the rich-poor divide could threaten region's stability.

"Asia's rapid growth is leaving millions behind, causing a widening gap between rich and poor that threatens to undermine the region's stability," the ADO said.

Referring to India, the report said that average rate of inflation, after remaining around 9 per cent of the most part of the last fiscal, is expected to be 7 per cent in 2012-13.

 The Reserve Bank had hiked interest rates 13 times between March 2010 and October 2011 to contain inflation and this has reduced investments and slowed down industrial activity.

ADB Deputy Country Director Narhari Rao said the RBI might cut repo rates in days ahead to boost growth.

"Easing of monetary policy looks a distinct possibility. The rate cut could come," Rao said. The RBI is scheduled to announce the annual credit policy on April 17.