India’s economy, which contracted by 7.3 per cent due to the pandemic, is expected to grow by 9.5 per cent in 2021 and 8.5 per cent in 2022, according to the latest projections released by the International Monetary Fund (IMF) on Tuesday.
India’s growth projection released by the latest World Economic Outlook (WEO) remains unchanged from its previous WEO update of July this summer but is a three-percentage point in 2021 and a 1.6 percentage point drop from its April projections.
According to the latest WEO update, released ahead of the annual meeting of the IMF and the World Bank, the world is expected to grow at 5.9 per cent in 2021 and 4.9 per cent in 2022.
The United States is projected to grow at six per cent this year and 5.2 per cent the next year.
China, on the other hand, the IMF said is projected to grow at 8 per cent in 2021 and 5.6 per cent in 2022.
Gita Gopinath, Chief Economist of the IMF, said that compared to their July forecast, the global growth projection for 2021 has been revised down marginally to 5.9 per cent and is unchanged for 2022 at 4.9 per cent. However, this modest headline revision masks large downgrades for some countries.
“The outlook for the low-income developing country group has darkened considerably due to worsening pandemic dynamics. The downgrade also reflects more difficult near-term prospects for the advanced economy group, in part due to supply disruptions,” she said.
Gopinath said that another urgent global priority is the need to slow the rise in global temperatures and contain the growing adverse effects of climate change. This will require more ambitious commitments to reduce greenhouse gas emissions at the upcoming United Nations Climate Change Conference (COP26) in Glasgow.
“A policy strategy that includes an international carbon price floor adjusted to country circumstances, a green public investment and research subsidy push, and compensatory, targeted transfers to households can help advance the energy transition in an equitable way. Just as importantly, advanced countries need to deliver on their earlier promises of mobilising $100 billion of annual climate financing for developing countries,” Gopinath said.
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