The reports released on Tuesday reveal an upward revision in forecast for India.
In a recent development, the International Monetary Fund (IMF) has revised India’s growth projection for FY24, raising it by 20 basis points from 6.1% to 6.3%. The WEO outlook report released on Tuesday, credits this adjustment to robust consumption figures recorded from April to June, surpassing earlier expectations. This positive outlook is supported by the nation’s economic resilience during the specified period.
India’s strong economic performance stands out, but a more sober tone prevails regarding the global economy. According to IMF Chief Economist Pierre-Olivier Gourinchas, the world economy is “limping along, not sprinting.”
The IMF maintains its 2023 global GDP growth forecast at 3%, consistent with the July projection. However, the 2024 outlook has been slightly downgraded, with a 10-basis-point reduction from the July estimate, now standing at a sombre 2.9%. These adjustments reflect the ongoing challenges and uncertainties in the international economic landscape.
“India is one of the large emerging economies that (have) been doing better than expected for quite a while now. (It) is one of the growth engines in the world economy,” said Pierre-Olivier Gourinchas, economic counsellor and director of the research department, IMF.
Earlier this month, the World Bank too said its economic growth forecast for India remained at 6.3 per cent, reinforced by strong investment growth. Both the finance ministry and the Reserve Bank of India (RBI) have retained their 6.5 per cent GDP growth estimate for FY24.
The IMF report said monetary policy projections were consistent with achieving the RBI’s inflation target over the medium term. In the monetary policy review last week, RBI Governor Shaktikanta Das said headwinds from geopolitical tensions and geoeconomic fragmentation, volatility in global financial markets, a global economic slowdown, and uneven monsoons posed risks to the economic outlook.
The International Monetary Fund on Tuesday left its global growth outlook unchanged for this year, highlighting the “remarkable strength” of the U.S. economy and projecting weaker forecasts for China and the Euro zone.
