The International Monetary Fund reported on Friday that India is navigating an “extremely tough” external environment, projecting growth rates of 6.8 per cent and 6.1 per cent for the current and following fiscal years, respectively. In her virtual conversation with reporters, Choueiri Nada, IMF’s India Mission Chief, reaffirmed that India continues to be the lone bright spot in an otherwise bleak picture of the world economy.
“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.
The report predicts that growth would slow down as a result of the less optimistic outlook and the tighter financial environment. According to the IMF’s report on India, the real GDP is expected to rise at 6.8 per cent and 6.1 per cent respectively in FY2022/23 and FY2023/24.
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.
The medium-term growth potential of India could be enhanced by either the effective implementation of extensive reforms or higher than anticipated benefits from the outstanding advancements in digitalisation.
(With inputs from agencies)
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