| Date: |
12-03-2015 |
| Subject: |
Indian economy to grow 7.5% in FY16: IMF |
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NEW DELHI: The Indian economy is forecast to grow 7.2% in 2014-15 and 7.5% in 2015-16, driven by stronger investment, following improvements in the business climate, the International Monetary Fund said on Wednesday.
The multilateral agency said the Indian economy is a bright spot in the global landscape and is becoming one of the fastest-growing big emerging market economies in the world. The data was based on the GDP series that India has introduced and prompted IMF to revise upwards its forecasts from earlier 5.6% in 2014-15 and 6.4% in 2015-16. The revised numbers are lower than the government's estimate of 7.4% in 2014-15 and 8.1-8.5% in 2015-16.
The IMF in its annual assessment said the Indian economy is reviving, helped by positive policy actions that have improved confidence but called for steps to revitalize the investment cycle and accelerate structural reforms. "Growth numbers are now much higher and the current account deficit is comfortable, in part due to the fall in gold imports and lower oil prices," said Paul Cashin, IMF Mission chief for India. "New investment project announcements have started to pick up, particularly in the power and transport sectors."
He also noted that bolstering financial sector health and further financial inclusion would support growth going forward. While the country is well placed to cope with external shocks, there are possible risks on the horizon, both external and domestic. "Spillovers from weak global growth and potential global financial market volatility could be disruptive, including from any unexpected developments as the United States begins to raise its interest rates," says Cashin.
The IMF also praised the revised method of measuring the economy that the Indian authorities have adopted but said it will continue to examine the improved methodology for deeper understanding of the country's near and medium term growth.
Source : timesofindia.indiatimes.com
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