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The International Monetary Fund (IMF) recently cut India's gross domestic product (GDP) growth by 300 basis points (bps) to 9.5 per cent for fiscal 2021-22 from its previous estimate of 12.5 per cent, citing the impact of the pandemic’s second wave on the economy and recovery process. For the next fiscal, however, IMF has raised the growth projection for the country to 8.5 per cent from 6.9 per cent.
"Recovery has been set back severely in countries that experienced renewed waves— notably India," the multilateral institution said. Its April forecasts hadn’t factored in the impact of the resurgence of COVID infections in India.
In its latest World Economic Outlook (WEO) forecast, IMF said India is set to benefit from an expected rise in global trade prospects once its supply side gains traction.
IMF’s India forecast for 2021-22 fiscal is higher than 8.3 per cent predicted by the World Bank but is in sync with some other agencies, including S&P and Moody’s.
However, the Reserve Bank of India now expects growth to hit 10.5 per cent in this fiscal, while India’s chief economic advisor KV Subramanian has said it could be close to 11 per cent.
Fibre2Fashion News Desk (DS)
The International Monetary Fund has cut India's GDP growth by 300 basis points to 9.5 per cent for fiscal 2021-22 from its previous estimate of 12.5 per cent, citing the impact of the second COVID-19 wave on the economy and recovery process. For the next fiscal, however, IMF has raised the growth projection for the country to 8.5 per cent from 6.9 per cent.