Washington, December 23
Projecting a growth rate of 6.8% and 6.1% in the current and the next fiscal respectively, the International Monetary Fund (IMF) on Friday said India is navigating a “very difficult” external environment.
Bright spot in gloomy scenario
India continues to be the bright spot in an otherwise gloomy global economic scenario. We are seeing the economy continue to grow pretty robustly this fiscal year. — Choueiri Nada, India Mission Chief, IMF
Choueiri Nada, the IMF’s India Mission Chief, in her virtual interaction with reporters reiterated that India continues to be the bright spot in an otherwise gloomy global economic scenario.
“We are seeing the economy continue to grow pretty robustly this fiscal year,” Nada said as the international financial body released the report of its annual consultations with India.
According to the report, growth is expected to moderate, reflecting the less favorable outlook and tighter financial conditions.
The real GDP is projected to grow at 6.8% and 6.1% in FY23 and FY24 respectively, said the IMF’s report on India. These projections are much better than they have been projecting earlier, Nada said. “In fact, in our projections, India is contributing half a per cent to global growth this year and next,” she said.
“But, of course, there are important risks and to have asked about those, we see that the risks are mostly on the downside and mostly coming from external factors. Perhaps the most important risk is sharper than anticipated global slowdown,” she said.
“We are seeing the global economy slowing down next year. But there are downside risks to the speed of the slowdown, and it could be much sharper than what we expected in the report. This will affect India through trade and financial channels,” Nada said.
She said the IMF also continues to see the war in Ukraine unresolved and could intensify and have an effect on trade and on prices of commodities. “You’ve only seen one inflation and so the advances in inflation could be reversed and this is an important risk as well,” she noted.
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