IMF Raises India's GDP Growth Prediction to 6.7% for FY24

The International Monetary Fund (IMF) has revised its economic forecast for India, indicating an upbeat growth trajectory in the coming fiscal year. The latest edition of the World Economic Outlook published by the IMF posits a bolstered growth in India's Gross Domestic Product (GDP) by 6.7% for the fiscal year 2024 (FY24).

An Upward Revision for India's Economy

The forecast marks an improvement of 40 basis points over the IMF's previous outlook released in October 2023, which suggested a lower GDP growth rate for the nation. This adjustment hints at positive international sentiment towards India's economic resilience and potential for expansion.

Sustained Growth into FY25 and FY26

Looking further ahead, the IMF has also updated its projections for the subsequent years, advancing its expectations for India's growth by 20 basis points for both FY25 and FY26. The Indian economy is predicted to register a growth of 6.3% in these two fiscal years, underscoring sustained strength in domestic demand.

Contrasting Global Economic Dynamics

In the context of the global economy, the IMF projects a growth rate of 3.1% in 2024, followed by 3.2% in 2025. These numbers are slightly higher than those projected in the October 2023 report, largely due to unexpected resilience displayed by the United States economy, growth in numerous significant emerging markets, and the effects of fiscal policies in China.

Despite this, global economic growth remains below the historical average of 3.8% from 2000 to 2019. Factors such as elevated central banks' policy rates aiming to curb inflation, withdrawal of fiscal stimulus in the face of mounting debts, and sluggish productivity growth continue to exert pressure on the worldwide economic landscape.

IMF, India, GDP