India is performing well when it comes to vaccinating people, which certainly shows support to its economy, a top International Monetary Fund official said on Tuesday as the global financial institution in its latest outlook stated a 9.5 per cent growth rate for the country this year.
“We don’t have a change to our growth forecast for this year for India. I mean India came out of a very, very tough second wave and that led to a big downgrade in July but we have no change (in its growth rate projections) as of now,” Gita Gopinath, Chief Economist of the IMF, told reporters during a virtual conference call on Tuesday.
The current World Economic Outlook growth estimate for India is unchanged from the last WEO update in July this summer, but it is down three percentage points in 2021 and 1.6 percentage points from April projections.
India’s economy, which fell by 7.3 percent last year owing to the COVID-19 epidemic, is expected to expand by 9.5 percent in 2021 and 8.5 percent in 2022, according to the latest WEO update, issued ahead of the IMF and World Bank annual meetings.
The forecasts suggest the world will grow at 5.9 per cent in 2021 and 4.9 per cent in 2022. The super economy of the world– the United States is projected to grow at six per cent in 2021 and 5.2 per cent in 2022. Another big economy of the world– China, is projected to grow at 8 per cent in this year and 5.6 per cent in next year, as per IMF.
Gopinath said the Indian economy is already balloting with many challenges with respect to the financial market, also in context with the fact that the virus is not gone yet.
“The Indians are doing well in terms of vaccination rates and that’s certainly helpful,” Gopinath said in response to a question.
Malhar Nabar, the head of the World Economic Studies section at the IMF’s Research Department, which prepares the World Economic Outlook (WEO), said there is still capacity to provide further assistance if the pandemic worsens, but only to the worst-affected households and businesses.
“But going forward over the medium term, it was important to put in place a credible medium-term strategy to bring down the debt to GDP ratio, and create space to meet the future development needs and infrastructure needs of the Indian economy,” Nabar said in response to a question.