The International Monetary Fund (IMF) maintains India’s growth forecast for 2021 at 9.5% after falling 3 percentage points from 12.5% in July following the severe second wave of the COVID-19 pandemic in India.
In its latest World Economic Outlook (WEO) report of October 2021, IMF expects India’s economy, which shrank by a record 7.3% due to the pandemic, to grow at 8.5% in 2022.
- The 2021 9.5% growth forecast is similar to the 2021-22 fiscal year forecast made by the Reserve Bank of India (RBI) at the latest Monetary Policy Committee meeting on October 8.
- The IMF has downgraded its global economic forecast from 6% to 5.9% in the latest WEO update released prior to the Annual Meeting and the World Bank.
- Developed countries, including the United States and China, have witnessed significant reductions in growth forecasts. The IMF has fixed U.S. growth at 6% (down 1 percentage point) and China at 8% (down 0.1 percentage points).
- “The worsening pandemic dynamics have significantly diminished the outlook for low-income developing country groups. The downgrade is a short-term outlook for advanced economic groups, partly due to supply turmoil,” said Chief Economist Gita Gopinath.
