The January 2018 updation of the World Economic Outlook of the IMF gives a surprising and pleasant forecast for the Indian economy. In contrast to the present slowing trend, the Fund predicts that the country’s GDP may grow at 7.4% in 2018 and 7.8% in 2019.
The World Economic Outlook, update with a title of ‘Brighter Prospects and Optimistic Markets’, signals an end to the demonetisation and GST induced dull phase for the Indian economy.
Last week, the Central Statistical Organization has predicted 6.5% growth rate for 2017-18. Already, the data for the last two quarters shows the economy has grown at 6.0% and a high growth rate of 7% is needed to reach at the fiscal year estimate of 6.5%.
The IMF also upscaled the world economic growth rate to 3.9% in 2018 compared to the 3.7% growth recorded in the last year.
Interestingly, the IMF forecasts Chinese growth rate at 6.6% for 2018; a healthy figure that can support the global economic recovery. IMF predicts an overall bright global economy in the coming years.
From the domestic point of view, the 7.4% prediction gives exuberance to the policy makers as the IMF gives a rare higher growth prediction compared to CSO. Prime Minister Narendra Modi is in Davos with nearly 130-member Indian delegation to address the world business and economic leaders.
India is sending a historically high participation in the 48 years history of the WEF. Modi is scheduled to deliver a keynote address at the plenary session on Tuesday.
He is also expected to interact with 120 members of the WEF’s International Business Council, that includes world’s top business leaders.