The International Monetary Fund (IMF) has cut India’s growth forecast to 6.1 percent, making it 120 basis points reduction in the last seven months.
This is the second downward revision done by IMF in seven months but hopes that India’s growth might pick up by 7 percent in 2020.
“The global economy is in a synchronised slowdown and the fund once again is downgrading growth for 2019 to 3 percent, its slowest pace since the global financial crisis. Growth continues to be weakened by rising trade barriers and increasing geopolitical tensions,” said Gita Gopinath, it’s Economic Counsellor and Director of the Research Department, to an English Daily.
IMF in its latest report said, “In India, growth softened in 2019 as corporate and environmental regulatory uncertainty, together with concerns about the health of the nonbank financial sector, weighed on-demand.”
“The downward revision relative to the April 2019 World Economic Outlook (WEO) of 1.2 percentage points for 2019 and 0.5 percentage point for 2020 reflects a weaker-than-expected outlook for domestic demand. Growth will be supported by the lagged effects of monetary policy easing, a reduction in corporate income tax rates, recent measures to address corporate and environmental regulations.”