NEW DELHI, Apr 16: The International Monetary Fund on Tuesday raised India’s growth projection to 6.8 per cent from its January forecast of 6.5 per cent citing bullish domestic demand conditions and a rising working-age population.
With this, India continues to be the fastest-growing economy in the world, ahead of China’s growth projection of 4.6 per cent during the same period.
“Growth in India is projected to remain strong at 6.8 per cent in 2024 and 6.5 per cent in 2025, with the robustness reflecting continuing strength in domestic demand and a rising working-age population,” said the latest edition of the World Economic Outlook released by the IMF ahead of the annual spring meetings of the IMF and the World Bank.
At the same time, growth in emerging and developing Asia is expected to fall from an estimated 5.6 per cent in 2023 to 5.2 per cent in 2024 and 4.9 per cent in 2025, a slight upward revision compared with the January 2024 WEO Update. IMF in its January update had projected 6.5 per cent growth for India in 2024.
“Growth in China is projected to slow from 5.2 per cent in 2023 to 4.6 per cent in 2024 and 4.1 per cent in 2025, as the positive effects of one-off factors — including the post-pandemic boost to consumption and fiscal stimulus — ease and weakness in the property sector persists,” the IMF said.
Global growth, estimated at 3.2 per cent in 2023, is projected to continue at the same pace in 2024 and 2025. The forecast for 2024 is revised up by 0.1 percentage point from the January 2024 WEO Update, and by 0.3 percentage point from the October 2023 WEO, the IMF said.
Policymakers should prioritize steps toward greater economic resilience such as strengthening government finances and revitalizing economic growth prospects, said Pierre-Olivier Gourinchas, chief economist of the IMF.
“Despite gloomy predictions, the global economy remains remarkably resilient, with steady growth and inflation slowing almost as quickly as it rose. The journey has been eventful, starting with supply-chain disruptions in the aftermath of the pandemic, an energy and food crisis triggered by Russia’s war on Ukraine, a considerable surge in inflation, followed by a globally synchronized monetary policy tightening,” he said.
(Manas Dasgupta)