The International Monetary Fund has revised the growth forecast of India's gross domestic product to 6.1% for the current fiscal.
The 0.2 percentage point upward revision as compared with the April projection reflects momentum from stronger domestic investments last year, according to the latest edition of the IMF's World Economic Outlook released on Tuesday.
“India remains an economy that is growing quite strongly—lower than last year but still fairly strong growth and momentum," Pierre-Olivier Gourinchas, chief economist and director of the research department at the IMF, said at a press conference after the report's launch.
India accounts for one sixth of global growth this year, said Daniel Leigh, division chief at IMF's research department. Inflation, too, is back within the target range, he said.
In the current environment, India’s food export restrictions will exacerbate volatility of food prices in rest of the world and can also lead to retaliatory measures, Gourinchas said. "We would encourage removal of such restrictions as they can be harmful globally," he said.
Global growth is projected to fall from 3.5% in 2022 to 3% in both 2023 and 2024 on an annual average basis, according to the report.
The forecast for FY24 remains well below the historical (2000-2019) annual average of 3.8%. Advanced economies continue to drive the decline in growth from 2022 to 2023, with weaker manufacturing as well as idiosyncratic factors offsetting stronger service activity, the IMF said.
In emerging markets and developing economies, the growth outlook is broadly stable for 2023 and 2024, although with notable shifts across regions, it said.
On a year-on-year basis, global growth bottomed out in the fourth quarter of 2022. However, in some major economies, it is not expected to bottom out before the second half of 2023.
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