The Asian Development Bank (ADB) today said that India's growth rate will improve to 7.4 per cent during 2017-18 and go up further to 7.6 per cent in the next fiscal, remaining ahead of China.

"The impact of the demonetisation of high-value banknotes is dissipating as the replacement banknotes enter circulation. Stronger consumption and fiscal reforms are also expected to improve business confidence and investment prospects in the country," said the Asian Development Outlook, ADB's flagship economic publication.

India recorded a growth rate of 7.1 per cent during 2016-17, notwithstanding the fears that demonetisation of high-value currency notes of Rs 500/1,000 in November last year would adversely impact the economic growth.