INDIA Will Regain Position As World’ Fastest Economy in 2018: IMF

October 11th, 2017 | by Sukumar Roy
INDIA Will Regain Position As World’ Fastest Economy in 2018: IMF
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THE just released report by the Washington DC based IMF will dismay some Indian opposition leaders as it has predicted  that the Indian economy  will retrieve the tag as the world’s fastest growing economy in 2018.The International Monetary Fund comprising as many as 189 countries mandated  to support the structure of the world’s economic and financial order with World Bank, has not  concealed the fact that due to the implementation of demonetization and GST –Goods and Services Tax – India  has lagged behind China in the current financial year .The IMF on Tuesday lowered India’s 2017 growth forecast to 6.7 per cent from the earlier estimate of 7.2 per cent  attributing the downgrade by half a per cent from its April and July projections to the “lingering impact” of  the demonetisation and the Goods and Services Tax .“In India, growth momentum slowed, reflecting the lingering impact of the authorities’ currency exchange initiative as well as uncertainty related to the midyear introduction of the country-wide Goods and Services Tax,” the IMF said in its latest World Economic Outlook report. There is another gladdening info when it says “The global recovery is continuing, and at a faster pace. The picture is very different from early last year when the world economy faced faltering growth and financial market turbulence. We see an accelerating cyclical upswing boosting Europe, China, Japan, and the United States, as well as emerging Asia,” said IMF Research Director Maurice Obstfeld while making the report public at a media conference.IMF’s chapter on India says although it expects India’s growth to recover next year, the IMF has slightly lowered the projection for 2018 as well — to 7.4 per cent from the earlier 7.7 per cent estimate. India’s growth rate in 2016 was 7.1 per cent.. With the downward revision for this year, India may have temporarily lost its ranking as the world’s fastest-growing major economy, yielding the top spot back to China, which is now projected to grow by 6.8 per cent this year. But IMF is hopeful that  India is likely to regain the tag of the fastest growing major economy in 2018 followed by neighbouring China likely  grow at 6.5 per cent in 2018, IMF  said. The IMF report is also likely to cheer up Team Modi when it says the new tax regime initiated in India “is among several key structural reforms under implementation that are expected to help push growth above 8 per cent in the medium term”. As part of its recommendations to boost growth, the report said simplifying and easing labour market regulations and land acquisition procedures would help improve India’s business climate. The report also mooted more support for women to join the labour force since “gender gaps in labour force participation not only hold back potential output but also limit women’s economic and social opportunities, harming inclusiveness”. The world economy is projected to grow at 3.6 per cent this year (up by 0.1 per cent from its previous estimate). It also raised the growth rate for the United States and the Euro area to 2.2 per cent and 2.1 per cent respectively ,up by 0.1 per cent and 0.2 per cent respectively. India will benefit due to improvement in international economy, says an official in IMF.

 

 

 

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