Skip to main content

India to remain the world's fastest growing economy: IMF

By
The International Monetary Fund (IMF) on Tuesday marginally lowered its 2015-16 growth forecast for India, which will still remain the world’s fastest growing major economy, and expressed optimism about its future prospects.
IMF now expects the Indian economy to grow 7.3% this year, lower than the 7.5% it projected in July. It expects growth to accelerate to 7.5% the following year.
That will cement India’s position as the fastest growing major economy, ahead of China, which the IMF expects will grow 6.8% this year, followed by 6.3% in the next.
IMF also lowered its global growth forecast by 0.2 percentage points to 3.1%, citing an uneven recovery as well as increasing downside risks to the growth outlook for emerging market economies that are grappling with declining commodity prices, depreciating currencies and growing volatility in financial markets.
The Washington-based multilateral institution attributed the lowering of India’s growth forecast to the weakening of global external demand and the consequent impact on Indian exports.
“India is not as open as China but when external demand weakens, it will impact Indian exports. Though domestic demand remains resilient, global developments are going to have an impact on India,” Gian Maria Milesi-Ferretti, deputy director of the research department at IMF, said at a press conference.
Indian exports contracted for the ninth consecutive month in August falling 20.7% to $21.2 billion in the month.
Still, falling commodity prices will help India because it is a net commodity importer and also in controlling inflation, Milesi-Ferreti said.
In its bi-annual World Economic Outlook, the release of which coincided with IMF’s annual meetings in the Peruvian capital Lima, the multilateral agency said India’s economy will also benefit from the “recent policy reforms, (and) a consequent pick-up in investment”.
It also said a sharp fall in inflation, on account of lower oil and agricultural commodity prices, has created space for further monetary policy easing but warned of upside risks to inflation. Retail inflation eased to 3.66% in August from a revised 3.69% a month ago.
HT Mint, New Delhi, 7th Oct. 2015

Comments

Post a Comment

Popular posts from this blog

Govt’s gamble on GST cuts: What do the bond and currency markets signal?

By
  It’s not just humans who suffer from cognitive biases; markets do too. Interestingly, different financial markets exhibit distinct biases, each interpreting events through its own prism of prejudice. Take the recent announcements on GST reforms: equity markets have chosen to view them through the lens of growth, while bond and currency markets are focusing on potential macroeconomic risks—fiscal pressures and current account challenges. So, which lens captures the true pulse?Equity markets may be right in expecting GST reforms to revive consumption, which has remained lacklustre for a while. But the key question remains—will this revival come at the cost of broader macro stability?It is well known that consumption stocks have rallied since the GST rationalisation announcement. But what about bond markets? What signals are they sending since this rejig was announced from the ramparts of the Red Fort?The signs aren't encouraging. Bond prices have slumped and yields have surged sinc...
Post a Comment
Read more

Luxury carmakers urge clarity on GST rates to boost festive season sales

By
  A clear picture regarding new GST rates at the earliest will help the overall auto industry, including the luxury car segment, to regain momentum in the ongoing quarter, which generally sees enhanced sales on account of the festive season.The high-powered GST Council, chaired by Finance Minister Nirmala Sitharaman, will meet on September 3-4 to discuss moving to a two-slab taxation.In an interaction with PTI, BMW Group India President and CEO Hardeep Singh Brar said the recent speculation about the change in GST rates has caused uncertainty in the minds of consumers.Consumer interest and demand is strong, but they (prospective buyers) have adopted a wait-and-watch approach, and this delayed decision-making is impacting new vehicle sales at a certain level, he noted."Expediting clarity on GST rates is essential to get back to speed and ensure the auto sector's contribution to economic growth during this quarter is robust," Brar stated.He also hoped that the sustainable p...
Post a Comment
Read more

Sebi proposes tighter norms for green bond third-party reviewers

By
  Sebi on Friday said it has proposed to tighten the norms to appoint independent third-party reviewers or certifiers for green debt securities to align them with requirements for other ESG-linked bonds.In a draft circular, Sebi said that the current norms for green bonds, introduced in February 2023, lack detailed requirements around reviewer independence, conflict of interest mitigation, and disclosure standards that are now in place for other ESG-linked securities under a June 2025 circular.The regulator's latest proposal seeks public comments on a revised framework that would bring parity by incorporating comprehensive criteria for third-party certifiers of green bonds on non-convertible securities.Under the proposed norms, issuers of green debt securities will need to appoint reviewers who are independent of their management, directors, and key managerial personnel. These reviewers will be remunerated in a way that prevents any conflicts of interest and possess relevant expert...
Post a Comment
Read more