The Indian economy is expected to grow faster than previously estimated this year and next, according to the latest report by the International Monetary Fund (IMF).
In its World Economic Outlook released on Tuesday, the IMF upgraded India’s economic growth forecast for the current fiscal year to 6.3% from the previous estimate of 6.1%, citing buoyant consumer activity in the second quarter.
“Growth in India is projected to remain strong, at 6.3% in both 2023 and 2024, with an upward revision of 0.2 percentage points for 2023, reflecting stronger-than-expected consumption during April-June,” the report said.
The upgrade is the latest of several revisions and is close to the Reserve Bank of India’s estimate of 6.5% GDP growth, making the country the world’s fastest growing developing economy this year.
The IMF noted that monetary policy expectations are consistent with achieving the Indian central bank’s inflation target over the medium term. The country’s regulator has projected consumer price index (CPI)-based inflation for the current fiscal year at 5.4%.
According to the Washington-based institution, India’s current account deficit is expected to remain at 1.8% of GDP in the 2024 and 2025 fiscal years.
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