“India A Bright Spot”: IMF Projects 2.9% Global Growth

The Indian economy is expected to slow down slightly in the upcoming fiscal year, according to the International Monetary Fund (IMF), which forecasted growth to drop to 6.1 percent from 6.8 percent during the current fiscal year ending March 31.

The January update to the IMF’s World Economic Outlook was released on Tuesday. According to this forecast, global growth is expected to decline from an estimated 3.4 percent in 2022 to 2.9 percent in 2023 before increasing to 3.1 percent in 2024.

“Our growth predictions for India have remained the same since our October Outlook. We expect growth of 6.8% for the current fiscal year, which ends in March, and a slight slowdown to 6.1% in fiscal year 2023. And a lot of that is caused by outside factors,” IMF Chief Economist and Director of Research Pierre-Olivier Gourinchas told reporters.

According to the IMF’s World Economic Outlook update, “Growth in India is set to decline from 6.8 percent in 2022 to 6.1 percent in 2023 before picking up to 6.8 percent in 2024, with resilient domestic demand despite external headwinds.”

After a more severe than anticipated slowdown in 2022 to 4.3 percent due to China’s economy, growth in emerging and developing Asia is predicted to increase to 5.3 percent and 5.2 percent, respectively, in 2023 and 2024.

For the first time in more than 40 years, China’s real GDP growth will slow in the fourth quarter of 2022, resulting in a 0.2 percentage point downgrade for 2022 growth to 3.0 percent. According to projections, China’s growth will reach 5.2 percent in 2023 due to rapidly improving mobility, then drop to 4.5 percent in 2024 before stabilizing at less than 4 percent over the medium term due to declining business dynamism and slow structural reform progress.