Which of the following statement/statements is/are correct based on the International Monetary Fund's (IMF) World Economic Outlook update?

1. The IMF raised India’s growth projection for 2024-25 (FY25) by 20 basis points to 6.5 percent.

2. The Ministry of Finance (FinMin) projected a higher growth rate of 7 percent for India in FY25.

3. The IMF increased its global growth projection for 2024 by 20 basis points to 3.1 percent.

Solution

The International Monetary Fund (IMF) raised India’s growth projection for 2024-25 (FY25) by 20 basis points (bps) to 6.5 per cent in its World Economic Outlook (WEO) update, citing buoyant domestic spending and improved global growth prospects.

The estimate falls below the 7 per cent growth projection by the Ministry of Finance (FinMin).

For FY24, the IMF raised India’s growth estimate by 40 bps to 6.7 per cent compared to its October report, which is still lower than the 7.3 per cent growth projected by the National Statistical Office earlier this month.

Growth in India is projected to remain strong at 6.5 percent in both 2024 (FY25) and 2025 (FY26), with an upgrade from October of 0.2 percentage point for both years, reflecting resilience in domestic demand.

The IMF raised its global growth projection for 2024 by 20 bps to 3.1 per cent, compared to its October report, citing greater-than-expected resilience in the United States and several large emerging market and developing economies, as well as fiscal support in China.

For China, the IMF increased its growth forecast for 2024 by 40 bps to 4.6 per cent.

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Formation: 27 December 1945    Headquarter: Washington, D.C., U.S.     

MD: Kristalina Georgieva