India will account for 15% of 2023 global growth: IMF
Says India remains a bright spot when global growth likely to fall 2.9% from 3.4% last year
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Washington: India continues to remain a relative bright spot in the world economy and will alone contribute 15 per cent of the global growth in 2023, International Monetary Fund (IMF) managing director Kristalina Georgieva said.
While digitisation pulled out the world's fifth-largest economy from pandemic lows, prudent fiscal policy and significant financing for capital investments provided in the next year's budget will help sustain the growth momentum.
"India's performance has been quite impressive. For this year, we expect India to retain a high growth rate, 6.8 per cent for the year that ends in March. For FY 2023/24 (April 2023 to March 2024) we project 6.1 per cent, a bit of slow down like the rest of the world economy, but way above the global average. And in that way, India is providing about 15 per cent of global growth in 2023," Georgieva told in an interview.
That is the fastest growth rate among major economies. India remains a bright spot at a time when the IMF is projecting 2023 to be difficult with global growth slowing down from 3.4 per cent last year to 2.9 per cent in 2023, she observed. “Why is India a bright spot? Because one, the country has done really well to turn the digitalization that has been already moving quite well into a major driver of overcoming the impact of the pandemic and creating opportunities for growth and jobs,” the Managing Director noted.
“Second, because India's fiscal policy has been responsive to economic conditions. We have seen the new budget presented, and it signals the commitment to fiscal consolidation, while at the same time provides significant financing for capital investments. And three, because India didn't shy away to learn the lessons from the pandemic and to implement very strong policies to overcome what has been really a difficult time for a number of months,” she said.
Responding to a question, Georgieva said she is impressed by two things in the latest annual budget presented by Union Finance Minister Nirmala Sitaraman.
Why is India a bright spot? Because one, the country has done really well to turn the digitalization that has been already moving quite well into a major driver of overcoming the impact of the pandemic and creating opportunities for growth and jobs
- Kristalina Georgieva, MD, IMF
