Anushruti Singh
The International Monetary Fund (IMF) on Tuesday slightly raised India’s GDP projection for the current fiscal to 6.1 per cent from 5.9 per cent.
However this projection by IMF is still lesser than the 6.5 per cent growth projected by RBI for 2023-24.
The IMF has also cautioned that persistent challenges could impact the medium term outlook.
“Growth in India is projected at 6.1 per cent in 2023, a 0.2 percentage point upward revision compared with the April projection, reflecting momentum from stronger-than-expected growth in the fourth quarter of 2022 (financial year 2022-23) as a result of stronger domestic investment,” the IMF said in an update to its World Economic Outlook (WEO) report.
The revision is mainly driven by fourth quarter growth of 2022-23, which was led by higher domestic investments.
Commenting on the IMF India’s GDP forecast, Suman Bannerjee, CIO, Hedonova, a US based Hedge Fund says India’s GDP depend on number of factors.
“GDP will rise due to strong tech and service sector growth, increased foreign investment, favorable demographic dividends, governmental policy reforms facilitating business, and a predicted recovery in consumer spending post-Covid-19, contributing to a healthier overall economic outlook. The forecast of 6.1 per cent is pessimistic, I expect it to be 6.3 per cent,”
A weak rupee has fostered more exports which has reduced the current account deficit and increased remittance income from $55.6 billion to $62.3 billion. Oil prices have been lower due to purchases from Russia and Iran over Norway, USA and Saudi Arabia and overall lower oil prices have kept the balance of payment account in check, he adds.
