As the economic survey is set to be released shortly by Union Finance Minister Nirmala Sitharaman, International Monetary Fund (IMF) has projected India to remain the fastest-growing major economy.
IMF projects growth at 6.1% in 2023
On Tuesday, the International Monetary Fund (IMF) published its World Economic Outlook for the month of January and projected that India has retained its GDP growth for 2022-23 and 2023-24 at 6.8% and 6.1%, respectively. However, the growth is expected to lower from 6.8%, estimated for FY23 but will still retain its position of being the fastest-growing economy.
According to the IMF, the economy will slow down in 2024 but will subsequently pick up the pace. “India’s growth is set to decline from 6.8% in 2022-23 to 6.1% in 2023-24 before picking up to 6.8% in 2024-25, with resilient domestic demand despite external headwinds,” the IMF said in an update to its World Economic Outlook report.
As per the projection, India will remain at a bright spot as along with China it will become a major engine of growth in 2023. India and China will contribute to half of the global growth this year, compared to just a tenth for the US and Euro Area combined.
IMF also forecasted the growth of other countries:
- USA: 1.4%
- Germany: -0.1%
- France: 0.7%
- Italy: -0.6%
- Japan: 1.8%
- UK: 0.6%
- China: 5.2%
- India: 6.1%
- Russia: -0.3%
- Brazil: 1.2%
- Mexico: 1.7%
- KSA: 2.6%
- Nigeria: 3.2%
- RSA: 1.2%
Global inflation to decline: IMF
According to the World Economic Outlook projections, global growth is projected to fall from an estimated 3.4% in 2022 to 2.9 % in 2023, then rise to 3.1% in 2024. Global inflation is expected to fall from 8.8% in 2022 to 6.6% in 2023 and 4.3% in 2024, still above pre-pandemic (2017–19) levels of about 3.5% in more than 80% of countries.
It is pertinent to mention that earlier this week, the World Bank also stated that India is expected to be the fastest-growing economy among the seven largest emerging-market and developing economies (EMDEs) even though its economic growth is projected to slow to 6.9% in FY23 and 6.6% in FY24 from 8.7% in 2021-22.