IMF raises India's growth forecast to 6.1% for current fiscal

International Monetary Fund (IMF) has raised India’s growth forecast, projecting a Gross Domestic Product (GDP) growth of 6.1 per cent in the current fiscal. In the World Economic Outlook that was released in April, the IMF had projected India’s GDP at 5.9 per cent in the current fiscal. The IMF in its latest World Economic Outlook report, which was released today said, the upward revision of 0.2 percentage points is reflective of the momentum from stronger-than-expected growth in the fourth quarter of 2022 as a result of stronger domestic investment. 
The IMF has kept the GDP growth projection for the fiscal year 2024-2025 unchanged at 6.3 per cent. India also retains the tag of the fastest-growing economy with neighbouring China estimated to grow at 5.2 percent in 2023 and 4.5 percent in 2024. The IMF in the latest World Economic Outlook report has also revised upwards the projection for global growth output to 3 per cent in 2023 from its previous forecast of 2.8 per cent. Advanced economies continue to drive the decline in growth from 2022 to 2023, with weaker manufacturing, as well as idiosyncratic factors, offsetting stronger services activity. Global headline inflation is expected to fall to 6.8 per cent in 2023 and further to 5.2 per cent in 2024 from 8.7 per cent in 2022.

The IMF has projected global inflation to fall to 6.8% this year from last year’s high of 8.7%. In most economies, the priority remains achieving sustained disinflation while ensuring financial stability. Therefore, central banks should remain focused on restoring price stability and strengthen financial supervision and risk monitoring, it said.

Chief Economist @pogourinchas on July 2023 #WEO: Global economic activity has proven resilient in the first quarter of 2023. But global growth remains weak by historical standards and is projected to fall from 3.5% in 2022 to 3% in 2023 and 2024. https://t.co/8pKjgg8udm pic.twitter.com/pCocK4qANJ

— IMF (@IMFNews) July 25, 2023

Higher interest rates are helping cool inflation, and quick action stopped further banking turmoil, but growth is being held back by a number of forces.

The IMF projects global growth to fall from 3.5% in 2022 to 3.0% in 2023, a 0.2 percentage point upgrade from our April forecast. Global inflation is projected to steadily decline. Read our analysis in the World Economic Outlook Update. https://t.co/8pKjgg8udm #WEO pic.twitter.com/mDGlZkMTEE

— IMF (@IMFNews) July 25, 2023

;(Ira Singh is the Asstt Editor)