India bright spot for IMF globally

[Styx]

NEW DELHI: The International Monetary Fund (IMF) cut its forecast for global growth this year but retained robust growth for India, which is expected to overtake China's rate of expansion in 2015 and maintain its position as the fastest growing economy in 2016.

The world economy is expected to grow 3.3% in 2015, slightly lower than the earlier estimate of 3.5%, IMF said in its World Economic outlook update. It retained the growth forecast of 3.8% for 2016. "Moderate growth continues, with global growth forecast to be slightly down for 2015, reflecting an unexpected setback to economic activity in the first quarter of 2015, mostly in North America." It also cautioned that Greece and events in China remain as downside risks.

"Disruptive asset price shifts and a further increase in financial market volatility remain as an important downside risk. Developments in Greece have, so far, not resulted in any significant contagion. Timely policy action should help to manage such risks if they were to materialize," IMF said.

Among other risks, it cited low medium-term growth or a slow return to full employment, amid very low inflation and crisis legacies in advanced economies; greater difficulties in China's transition to a new growth model, as illustrated by the recent financial market turbulence; and spillovers to economic activity from increased geopolitical tensions in Ukraine, the Middle East, or parts of Africa.

IMF expects the Indian economy to grow by 7.5% in 2015 and 2016, faster than China's expansion of 6.8% in 2015 and 6.3% in 2016. China was the fastest growing economy in 2014 at 7.4% compared to India's 7.3% expansion, according to the IMF data. The government had estimated growth in the 8-8.5% range for 2015-16 and the Reserve Bank of India expects the economy to expand 7.6%.

The government has taken several measures to boost growth, which is widely expected to yield results in the months ahead. However, economists say the sharp slowdown in China and the financial market turbulence have the potential to hurt the global economy. IMF chief Christine Lagarde had said that India is a bright spot and economic developments in the country hold much promise.

IMF said rise in global growth in 2015 will be driven by stronger growth in advanced economies. Growth in these economies is forecast to increase from 1.8% in 2014 to 2.1% in 2015 (falling about 0.3 percentage points short of the forecast in April), and 2.4% in 2016.

India bright spot for IMF globally - The Times of India

 

[Rau]

NEW DELHI: The International Monetary Fund (IMF) cut its forecast for global growth this year but retained robust growth for India, which is expected to overtake China's rate of expansion in 2015 and maintain its position as the fastest growing economy in 2016.

The world economy is expected to grow 3.3% in 2015, slightly lower than the earlier estimate of 3.5%, IMF said in its World Economic outlook update. It retained the growth forecast of 3.8% for 2016. "Moderate growth continues, with global growth forecast to be slightly down for 2015, reflecting an unexpected setback to economic activity in the first quarter of 2015, mostly in North America." It also cautioned that Greece and events in China remain as downside risks.

"Disruptive asset price shifts and a further increase in financial market volatility remain as an important downside risk. Developments in Greece have, so far, not resulted in any significant contagion. Timely policy action should help to manage such risks if they were to materialize," IMF said.

Among other risks, it cited low medium-term growth or a slow return to full employment, amid very low inflation and crisis legacies in advanced economies; greater difficulties in China's transition to a new growth model, as illustrated by the recent financial market turbulence; and spillovers to economic activity from increased geopolitical tensions in Ukraine, the Middle East, or parts of Africa.

IMF expects the Indian economy to grow by 7.5% in 2015 and 2016, faster than China's expansion of 6.8% in 2015 and 6.3% in 2016. China was the fastest growing economy in 2014 at 7.4% compared to India's 7.3% expansion, according to the IMF data. The government had estimated growth in the 8-8.5% range for 2015-16 and the Reserve Bank of India expects the economy to expand 7.6%.

The government has taken several measures to boost growth, which is widely expected to yield results in the months ahead. However, economists say the sharp slowdown in China and the financial market turbulence have the potential to hurt the global economy. IMF chief Christine Lagarde had said that India is a bright spot and economic developments in the country hold much promise.

IMF said rise in global growth in 2015 will be driven by stronger growth in advanced economies. Growth in these economies is forecast to increase from 1.8% in 2014 to 2.1% in 2015 (falling about 0.3 percentage points short of the forecast in April), and 2.4% in 2016.

India bright spot for IMF globally - The Times of India