New Delhi: At a time when the economic condition of the country is going through a tough phase, the International Monetary Fund (IMF) on Tuesday reduced India’s economic outlook growth projection to 6.1% in 2019 from 6.8% in 2018. The IMF has trimmed the growth forecast by 90 basic points. This is the second negative revision from the IMF in seven months and in total 120 basis points reduction.
The IMF in its April report had stated that India will grow at 7.3 per cent in 2019. However, three months later it projected a slower growth rate for the country.
The announcement from the IMF comes two days after the World Bank (WB) in its report projected India’s economic growth in the current fiscal at 6 per cent, lower than the Reserve Bank of India’s latest revised outlook of 6.1 per cent.
“In India, after the broad-based deceleration in the first quarters of this fiscal year, growth is projected to fall to 6.0 per cent this fiscal year,” said the report named ‘South Asia Economic Focus, Fall 2019: Making (De)centralization Work’.
As per the WB, the growth rate in 2018-19 stood at 6.9 per cent, down from 7.2 per cent in the financial year 2017-18, news agency PTI reported.
However, the bank in its latest edition of the South Asia Economic Focus said the country was expected to gradually recover to 6.9 per cent in 2021 and 7.2 per cent in 2022.
While industrial output growth increased to 6.9 per cent due to a pick-up in manufacturing and construction activities, the growth in agriculture and the services sector moderated to 2.9 and 7.5 per cent, respectively.
In the first quarter of 2019-20, the economy experienced a significant and broad-based growth deceleration with a sharp decline in private consumption on the demand side and the weakening of growth in both industry and services on the supply side, the report said.