IMF Cuts India's GDP Growth Forecast To 5.9% For FY24
The IMF projects India's GDP to grow 20 basis points lower than estimated in January this year.
The International Monetary Fund on Tuesday cut India's GDP growth forecast for the 2024 and 2025 financial years amid a slowing global economy.
The IMF projects the gross domestic product to grow 5.9% in 2023–24, 20 basis points lower than estimated in January this year. It projects India to grow 6.3% in the 2025 fiscal, 50 basis points lower than estimated earlier.
Tentative signs in early 2023 that the world economy could achieve a soft landing—with inflation coming down and growth steady—have receded amid stubbornly high inflation and the recent financial sector turmoil, the IMF said.
The global outlook is uncertain again amid the financial sector turmoil, high inflation, effects of Russia-Ukraine war and three years of Covid, according to the IMF.
It estimated the baseline forecast for global growth to fall from 3.4% in 2022 to 2.8% in 2023 before settling at 3% in 2024. Advanced economies are expected to see an especially pronounced slowdown in growth, from 2.7% in 2022 to 1.3% in 2023.
In a plausible alternative scenario with further financial sector stress, global growth declines to about 2.5% in 2023 with the advanced economy growth falling below 1%.
The global headline inflation in the baseline is set to fall from 8.7% in 2022 to 7% in 2023 on the back of lower commodity prices, but underlying core inflation is likely to decline more slowly.
