After the World Bank, now the International Monetary Fund (IMF) has also reduced India’s potential growth rate. The IMF has predicted India’s growth rate to be 6.1 percent, with a cut of 1.2 percent in April. However, the growth rate is expected to be 7% in 2020. The IMF has reduced the global economic growth forecast to 3 percent in 2019.
It was 3.8 percent last year. One thing of satisfaction for India is that despite the decrease in speed, it can regain the title of ‘Fastest Economy’ with China, while in 2020 it will be alone.
The IMF said in April that India would grow at a 7.3 percent pace in the current financial year. However, after 3 months it had cut the estimate by 0.3 percent. The growth rate in 2018 was 6.9 percent. Earlier, the World Bank lowered India’s economic growth forecast to 6 percent on Sunday.
The World Bank said the inflation rate is low and if the monetary stance remains soft, they expect the growth rate to gradually improve to 6.9 percent in 2021 and 7.2 percent in 2022.
After the World Bank now IMF cuts growth rate of Indian Economic
According to the IMF, this reflects a weaker than expected domestic demand. The IMF said the recent move to adopt a soft stance in monetary policy, reduce corporate tax, remove regulatory uncertainties related to corporate and environment and government programs to increase rural demand will support growth.
Its effect will be seen after some time.
The IMF has forecast China’s economic growth at 6.1 percent in the current year and 5.8 percent in 2020. Whereas in 2018 the economic growth rate of the neighboring country was 6.6 percent.
On the basis of the last quarter of the financial year 2018-19, the ‘world’s fastest economy’ title taken away from India. India’s growth rate was 5.8 percent in this quarter, while China’s economic growth rate was 6.4 percent. India also lagged in China in the first quarter of the current financial year.
In the global economic growth rate, the IMF said that they have reduced the global growth rate estimate for 2019 to 3 percent. The main reason for this is the increase in trade restrictions and geopolitical tensions. IMF Chief Economist Indian-American Geeta Gopinath said that this decline in estimates is more serious than the global economic growth rate of 3.8 percent in 2017.
He said that with the softening of various factors coming together and the uncertainty of improving it, the global scenario also remains uncertain.
