IMF's World Economic Outlook suggests growth slowdown in current year is concentrated in advanced economies, while emerging & developing economies are likely to lead global growth.
During the G20 summit, India is expected to drive discussions on time-bound debt resolution for countries in distress, reforming multilateral development banks & finalising crypto-regulation.
There are, however, also some incipient signs of stress in the form of shrinking net interest margins & build-up of bad loans in retail segment that need to be monitored.
Central govt's capital expenditure has seen strong growth. State finances present an encouraging picture with better tax revenue collections & improved capex spending.
Fitch downgraded US government’s credit rating. And while markets across the world, including India, slumped in response, volatility will likely be driven by other factors.
IMF has increased its growth projection by 0.2 percentage points, but tightening of monetary policy world over & rising debt distress among developing nations could drag down growth.
Moreover, India’s tight capital controls, management of the rupee and, importantly, a smaller share of global exports run counter to aspirations of making it an international currency.
India's projects related to BIMSTEC, Look-East-Act-East and Indian Ocean Rim Association could suffer a setback, impacting trade with South Asia and the South-South Cooperation agenda.
While global corporations setting up GCCs in India continue to express confidence in availability of skilled AI engineers, the panel argued that India’s real challenge lies elsewhere.
Without a Congress revival, there can be no challenge to the BJP pan-nationally. Modi’s party is growing, and almost entirely at the cost of the Congress.
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