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Posted at: Oct 10, 2018, 12:54 AM; last updated: Oct 10, 2018, 12:54 AM (IST)

IMF pegs 7.3% growth for India in current fiscal

Washington, October 9

India is projected to grow at 7.3% in 2018 and 7.4% next year, the IMF said today, predicting that the country will regain the tag of the world’s fastest growing major economy this year, surpassing China with more than 0.7 percentage points.

In 2017, India had clocked a 6.7% growth rate.

In India, important reforms have been implemented in the recent years, including the Goods and Services Tax (GST), the inflation-targeting framework, the Insolvency and Bankruptcy Code, and steps to liberalise foreign investment and make it easier to do business, the International Monetary Fund (IMF) said in its latest World Economic Outlook (WEO) report.

“India’s growth is expected to increase to 7.3% in 2018 and 7.4% in 2019 (slightly lower than in the April 2018 World Economic Outlook (WEO) for 2019, given the recent increase in oil prices and the tightening of global financial conditions), up from 6.7% in 2017,” it said in the WEO report.

This acceleration, the world body said, reflected a rebound from transitory shocks (the currency exchange initiative and implementation of the GST), with strengthening investment and robust private consumption.

India’s medium-term growth prospects remain strong at 7¾ per cent, benefiting from the ongoing structural reforms, but have been marked down by just under a half percentage point relative to the April 2018 WEO, it said.

If projections are true, then India would regain the tag of the fastest growing major economy of the world, crossing China with more than 0.7 percentage points in 2018 and an impressive 1.2 percentage point growth lead in 2019.

China was the fastest growing economy in 2017 as it was ahead of India by 0.2 percentage points. For the record, the IMF has lowered the growth projections for both India and China by 0.4% and 0.32%, respectively, from its annual April’s WEO. — PTI

World Economic Outlook report

  • The IMF has predicted that India will regain the tag of the world’s fastest growing major economy this year, surpassing China with more than 0.7 percentage points
  • In 2017, India had clocked a 6.7% growth rate
  • This acceleration, the world body said, reflected a rebound from transitory shocks with strengthening investment and robust private consumption

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