IMF is optimistic that indian economy is all set to shine as it has been reported by the institution that india’s real gdp growth for the current fiscal is 6.8% , while the growth rate for 2023-24 is forecasted to be 6.1 %
The International Monetary Fund (IMF) has expressed optimism about the Indian economy, suggesting that real GDP is expected to grow at 6.8% in the current fiscal year and at 6.1% in 2023–24. This is despite the fact that the world economy is experiencing recessionary trends as a result of persistent global headwinds and a fluid geopolitical situation caused by the ongoing Russia–Ukraine conflict.
On November 28 last year the Article IV consultation with india was concluded by the executive board of the IMF where it was stated that the indian economy have shown resilience and has rebounded from the deep economic downturn due to pandemic
The Report said that the real GDP of the country was growing at the rate of 8.7% in 2021-22 which brought the total output above the ore pandemic level. Growth has been stable in this current fiscal , supported by recovery in the labor market and increasing credit to the private sector. The decrease in the covid cases supported by a high vaccination rate. Increased eligibility requirements for boosters and the free administration of booster shots should increase vaccine coverage.
According to the IMF the indian government policies are addressing new economic breeze “These include inflation pressures, tighter global financial conditions, the fallout from the war in Ukraine and associated sanctions on Russia, and significantly slower growth in China and advanced economies,” as noted by the international body
It further added that the government has responded by implementing fiscal policy measures to help disadvantaged groups and lessen the impact of high commodity prices on inflation. As monetary policy accommodation has been gradually decreased in 2022, the main policy rate has already increased by 190 basis points.
Explaining about the state of indian economic trajectory the international body have conveyed that the growth is expected to be moderate due to less favourable slant and stricter financial conditions. The Real Gdp is expected to grow at 6.8% in the current fiscal and 6.1% in 2023-24. The inflation is projected to be at 6.9 % for the current fiscal however it is predicted that the inflation will tone down in the next fiscal. It is predicted that the current account deficit will reach 35% of GDP in 2022–2023 as a result of rising commodity prices and increased import demand.
A gradual slowdown in the global growth in the near term will surely affect the india economy through trade and financial channels. The prolonged Ukrainian war is expected to cause a disruption in the global food and energy market and india is expected to face the impact as well
The IMF executive directors have signified that the Indian government has taken appropriate measures to maintain the economic structure of the country after the pandemic with front-loaded monetary policy tightening to address elevated inflation, fiscal policy measures to support vulnerable groups are implemented.
