IMF lowers India’s growth forecast to 7.4 pc
New Delhi, July 26
The International Monetary Fund (IMF) has lowered India’s growth forecast for the current year to 7.4 per cent from the earlier 8.2 per cent.
A few days back, the Asian Development Bank (ADB) too had lowered the economic growth forecast for India for 2022-23 to 7.2 per cent from its earlier estimation of 7.5 per cent due to the impact of Covid and the Russia-Ukraine war.
In its World Economic Outlook for July, the IMF said For India, the downward revision by 0.8 per cent reflects mainly less favorable external conditions and more rapid policy tightening.
The IMF lowered China’s growth prospects more sharply by 1.1 per cent and said this sharp slowdown and the moderation in India’s economy will lead to emerging and developing Asia losing 0.8 percentage of the growth anticipated in the IMF’s previous World Economic Outlook in April.
The downgrade to growth in China, to 3.3 per cent is the lowest growth in more than four decades due to further lockdowns and the deepening real estate crisis, noted the IMF report.
The baseline forecast is for global growth to slow from 6.1 per cent last year to 3.2 per cent in 2022, 0.4 percentage point lower than in the April 2022 World Economic Outlook.
In the US, lower growth reduced household purchasing power, and tighter monetary policy drove a downward revision of 1.4 percentage points
The IMF has revised upwards global inflation due to food and energy prices as well as lingering supply-demand imbalances. It is anticipated to reach 6.6 per cent in advanced economies and 9.5 per cent in emerging market and developing economies. The disinflationary monetary policy is expected to bite, with global output growing by just 2.9 per cent.
