After the ADB and World Bank’s gave positive projections for India’s economic growth, it is the IMF’s turn to confirm the good news. The International Monetary Fund has estimated that the Indian economy is to grow at 7.5% in 2015-16, making it one of the fastest growing large economies.
The organization added that India would continue to grow at the same rate in 2016, though it wouldn’t exceed 7.8% growth until 2020-21. Earlier, Arvind Panagariya, vice-chairman of the National Institution for Transforming India (NITI) Aayog, had said that he expects the “Indian economy to grow at 8-10% for the next 15 years. If the economy actually grows 8-10% in rupee terms, in dollar terms, it will be 11-12%. That kind of growth will turn India into an $8-trillion economy from the current $2 trillion.”
The Indian economy is slated to grow faster than China’s (which is facing a slow down after decade long high growth), owing to an increase in disposable income and incremental investments over the coming years due to recent policy reforms. China, after seeing high growth over the past decade, is now facing a slowdown, with growth projected to be 6.8 % in 2016 and 6.3% in 2017, which is to continue till 2020.
The World Bank had earlier estimated that India’s economy would grow at 7.5% in 2015-16 and 8% in 2017-18, owing to the projected investment growth of 12% during FY’16 to FY’18. The global growth is expected to be 3.5 and 3.8% over the same period.
According to the IMF’s prediction, India’s retail inflation will be 6.1% in 2015-16 and 5.7% in 2016-17. If the projection proves true, inflation would be in line with the Reserve Bank of India (RBI)’s target of 6% cent by January 2016. India’s Current Account Deficit would come down to 1.3% of GDP this financial year, from 1.4% in 2014-15.
Recently released RBI estimates have projected a growth of 7.8% for the current year, up from 7.5% last year.
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