Mumbai: The International Monetary Fund (IMF) on Tuesday slashed India’s economic growth forecast for the fiscal year 2021-22 to 9.5% from 12.5%.
IMF chief economist Gita Gopinath said the revision in growth forecast reflects a significant “extent gap” in the growth of the coronavirus disease (Covid-19) as the highly contagious delta variant takes effect around the world.
Economic Adviser and Director of the research department at the IMF Gopinath said, “The expected vaccination rates and return to normalcy have led to the upgradation, while lack of access to vaccines and renewed waves of Covid-19 cases in some countries, notably India, have led to downgrades.
On the other hand, the IMF has raised its forecast for 2022 from 6.9% to 8.5%.
The Economic Survey, presented in January ahead of this year’s budget session, projected India to grow at 11% during the 2020-21 financial year. Although India’s gross domestic product (GDP) has declined by 7.3% in 2020-21, these projections of higher growth are on low ground.
As the global economic recovery continues with the opening up of economies, Gopinath highlighted the “growing gap” between advanced economies and developing economies.
“The global economic recovery continues, but with a widening gap between advanced economies and many emerging markets and developing economies. Our latest global growth forecast of 6 percent for 2021 is unchanged from the previous outlook, but the composition has changed,” IMF’s Chief Economist Gita Gopinath said in a blog post released along with the WEO.
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