IMF raises India's FY24 growth forecast to 6.3%

The International Monetary Fund (IMF) has raised its growth forecast for India's GDP in the fiscal year 2023-24 to 6.3%, up by 20 basis points from previous estimates. India is anticipated to maintain its position as the world's fastest-growing major economy this year and the next. This outlook aligns with the projections made by the World Bank in its India Development Update on October 3. However, it's important to note that the IMF's revised forecast, although robust, remains below the 6.5% projection set by the Reserve Bank of India's Monetary Policy Committee.

Globally, the IMF highlights that the pace of economic recovery is moderate, stating, "The global economy is limping along, not sprinting." The IMF's current outlook maintains a global GDP growth of 3% for 2023, consistent with its previous forecast. Nevertheless, the forecast for 2024 has been slightly revised downward to 2.9%.

Concerns persist about the uneven recovery from the pandemic and supply chain disruptions, partly due to geopolitical events like Russia's invasion of Ukraine. Additionally, the IMF underscores the potential impact of the Israel-Palestinian conflict on global economic stability. Amid these dynamics, the IMF urges central banks to balance price stability with interventions to alleviate potential financial stress, while fiscal policymakers should focus on targeted measures to support vulnerable sectors and ensure budgetary resilience.