IMF raises India's FY24 growth forecast to 6.3%
International Monetary Fund (IMF) has bumped up India's growth forecast for FY24 to 6.3% from 6.1% estimated earlier, hailing the country as one of the «growth engines in the world economy».
The upward revision reflects «stronger-than-expected consumption during April-June», IMF said in the World Economic Outlook (WEO) released Tuesday. The outlook for FY25 is unchanged at 6.3%.
IMF's upgrade is the latest after other forecasters including Moody's, Morgan Stanley, and Nomura raised their FY24 growth estimates for India.
«It (India) has been doing better for a while now. And we've mentioned that India is, in fact, one of the growth engines in the world economy,» IMF chief economist Pierre-Olivier Gourinchas said, responding to a query from ET.
Inflation pegged at 5.5% now
India will continue to be the fastest-growing major economy.
Real per capita output is seen up 5.5% in FY23, IMF said.
The Reserve Bank of India has projected 6.5% growth for this fiscal.
The projections do not consider the impact of the latest geopolitical developments in West Asia after the Hamas attack on Israel and the latter declaring war.
«We are monitoring the situation very carefully in terms of the economic impact that it may have...but it is too early to assess the impact,» Gourinchas said. «It broke out when the current projections were closed.
We have to wait a little bit more,» he said.
He pointed out that oil prices had increased by about 4%, which is seen when there is geopolitical instability. «This reflects potential disruption on oil prices,» Gourinchas said, adding that a 10% increase in oil prices will weigh down global output by about 0.15% and increase inflation by 0.4% points.
«But it's too early to jump to any conclusion,»
