New Delhi: The International Monetary Fund (IMF) on Tuesday cut its forecast for India’s growth in 2022 to 6.8 per cent.
The IMF in July had projected a gross domestic product growth of 7.4 per cent in the year starting April 2022. In January, it had predicted 8.2 per cent.
IMF Growth Forecast: 2023
USA🇺🇸: 1%
Germany🇩🇪: -0.3%
France🇫🇷: 0.7%
Italy🇮🇹: -0.2%
Spain🇪🇸: 1.2%
Japan🇯🇵: 1.6%
UK🇬🇧: 0.3%
Canada🇨🇦: 1.5%
China🇨🇳: 4.4%
India🇮🇳: 6.1%
Russia🇷🇺: -2.3%
Brazil🇧🇷: 1%
Mexico🇲🇽: 1.2%
KSA🇸🇦: 3.7%
Nigeria🇳🇬: 3%
RSA🇿🇦: 1.1%https://t.co/VBrRHOfbIE #WEO pic.twitter.com/0TDJbgSuka
— IMF (@IMFNews) October 11, 2022
India had grown at 8.7 per cent in the 2021-22 fiscal year.
In its annual World Economic Outlook (WEO) report released Tuesday, the IMF’s 0.6 per cent cut reflected “a weaker-than-expected outturn in the second quarter and more subdued external demand,” reports said.
The IMF also cut Asia’s economic growth forecasts, and now expects emerging Asian economies to grow 4.4 per cent this year and 4.9 per cent in 2023, down 0.2 percentage point and 0.1 point respectively, from its projections in July, after a 7.2 per cent expansion in 2021.
The report said: “A widening debt crisis in (emerging) economies would weigh heavily on global growth and could precipitate a global recession. Further U.S. dollar strength can only compound the likelihood of debt distress.”
The Asian cut largely reflects a downgrade for growth in China to 3.2 per cent this year from an 8.1 per cent expansion in 2021, “a result of the country’s strict COVID-19 lockdowns and its worsening property market crisis”, the IMF said.
Global growth is forecast to slow from 6.0 per cent in 2021 to 3.2 per cent in 2022 and 2.7 per cent in 2023 — the weakest growth profile since 2001.
“The global economy continues to face steep challenges, shaped by the lingering effects of three powerful forces: the Russian invasion of Ukraine, a cost-of-living crisis caused by persistent and broadening inflation pressures, and the slowdown in China,” said Pierre-Olivier Gourinchas, Economic Counsellor and the Director of Research of the IMF, in his forward to the WEO released during the annual meeting of the IMF and the World Bank.
More than a third of the global economy will contract in 2023, while the three largest economies — the United States, the European Union, and China — will continue to stall. “In short, the worst is yet to come, and for many people 2023 will feel like a recession,” he wrote.
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