PAT FOR INDIA AT DAVOS: India to remain the fastest-growing economy in world in next two years


DAVOS: Now, the good news, restated of course. India is likely to remain the fastest growing major economy in the world for the next two years –a time when global growth would slow down. This is stated by the International Monetary Fund in its World Economic Outlook report before the start of the World Economic Forum summit here on Monday.

It said India’s gross domestic product (GDP) is likely growing at 7.5 percent in 2019 and 7.7 percent in 2020. At the same time, the global economy is expected decelerate to 3.5 percent in 2019 from 3.7 percent last year.
India’s growth in 2018 could be put at 7.3 percent, which is 10 basis points higher than the government’s own estimate. That’s still the fastest pace in three years as the country recovers from the twin shocks of demonetisation and an overhaul of its indirect tax structure.

There, however, are a number of risks to the IMF’s outlook. Cross-border trade tensions are escalating and global trade, investment and output remain under threat from that uncertainty. Besides, this will have an impact on financial market sentiment. “With momentum past its peak, risks to global growth skewed to the downside, and policy space limited in many countries, multilateral and domestic policies urgently need to focus on preventing additional deceleration and strengthening resilience.”

The IMF has also urged policymakers to cooperate and work towards resolving these issues that could seriously hurt global growth in the longer run. An “overarching” challenge for all countries is mitigating climate change to lower its “devastating” humanitarian and economic effects. “Failure to do so would further destabilise a slowing global economy.” –AGENCIES, IHN=NN


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