Good news on the economy front, IMF increases India’s GDP growth rate, estimated to be 6.1% – imf raises India growth forecast to 6.1 percent for fy24
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In its latest World Economic Outlook, the IMF said, “India’s growth rate is estimated to be 6.1 per cent in 2023.” This is 0.2 percent more than the estimate expressed in April. According to the report, however, the global growth rate is expected to slow down to 3 per cent in 2023 and 2024 from 3.5 per cent in 2022. Although the forecast for 2023 is slightly better than the one projected in April this year, the growth rate remains weak by historical standards.
It has been said in the report that the increase in the policy rate of the central bank to bring inflation under control has affected the economic activities. Globally, retail inflation is expected to decline from 8.7 per cent in 2022 to 6.8 per cent in 2023 and 5.2 per cent in 2024. The Monetary Fund said the recent resolution of the US debt ceiling standoff and tighter measures by authorities to prevent industry turmoil following the failures of some banks in the US and Switzerland earlier this year have eased risks to financial sector volatility.
This has somewhat reduced the risk on the outlook. However, risks to global growth remain. The report said that if there are more shocks, inflation may remain high and may even rise. This includes a tighter monetary policy stance due to the escalation of the war in Ukraine and weather-related challenges. It has been said that due to further tightening of the monetary policy of the central bank, there may be some problems in the financial sector. The pace of revival may be slow due to problems in the real estate sector in China.
According to the report, “Debt crisis at the government level can affect many economies. The good news is that inflation may be coming down faster than expected. This will not require tight monetary policy and domestic demand can be stronger.
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