ARUN KUMAR Washington/ New Delhi
The International Monetary Fund on Friday lowered Indias economic growth forecast to 6.9 percent for 2012, as compared to 7 percent projection announced in January.
The Washington- based mult
ilateral agency said it has lowered its growth outlook on India mainly due to lack of reforms and structural factors, which has resulted in slowdown in investment.
However, the IMF kept its forecast for 2013 unchanged at 7.3 percent. As per the IMF data, Indian economy grew by 7.1 percent in 2011.
‘Concerns about governance and slow project approvals by the government have weakened business sentiment, which in turn has adversely affected investment, along with cyclical factors such as global uncertainty and policy tightening,’the IMF said.
Even as it lowered the growth forecast, the IMF said led by India and China, Asia will remain the fastest growing region in the world.
In fact Indias growth will rise to 7.3 percent in 2013, with growth in Asia expected to pick up this year, after slowing in the last quarter of 2011, the IMF said in its outlook for the Asia Pacific region released in Kuala Lumpur.
Similarly, Chinas growth, after dipping to 8.2 percent this year from 9.2 percent in 2011, will rise again to 8.8 percent in 2013.
The region is expected to continue growing at around 6 percent this year, before rebounding to about 6.50 percent in 2013, said the IMF forecast.
But Asian leaders now face the difficult task of adjusting policies to support stable, non- inflationary growth.
