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IMF’s World Economic Outlook(WEO) 2024 report raises India’s GDP growth forecast by 30bps to 6.8% for FY25

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IMF raises India's GDP growth forecast by 30 bps to 6.8% for FY25On 17th April 2024, the International Monetary Fund (IMF) released its bi-annual report titled World Economic Outlook(WEO) – Steady But Slow: Resilience Amid Divergence (April 2024). According to the report IMF has raised India’s GDP(Gross Domestic Product) growth forecast by 30 basis points(bps) to 6.8% for fiscal year 2025(FY25) and retained the forecast for FY26 at 6.5%.

  • With the increase in domestic demand and a rising working age population, growth in India is projected to remain at 6.8% in FY25 6.5% in FY26.

Points to note:

i.India’s GDP grew by an impressive 7.8% in FY 2024(2023-2024), higher than the 6.7% predicted in IMF’s January 2024 report.

ii.The report projected India’s consumer price inflation to decline from an average of 5.4%FY24 to 4.6% FY25 and will further decrease to 4.2% FY26.

Global Scenario:

i.Global growth, estimated at 3.2% in 2023, is projected to continue at the same pace in 2024 and 2025, up by 0.1% from the January 2024 WEO Update.

ii.The projection for global growth in 2024 and 2025 is below the historical (2000–19) annual average of 3.8%.

iii.The report estimated that growth in emerging and developing Asia to fall from an estimated 5.6 % in 2023 to 5.2 % in 2024 and 4.9% in 2025, a slight upward revision compared with January 2024 WEO update.

iv.The report projected that China’s GDP to decrease from 5.2 % in 2023 to 4.6 % in 2024 and 4.1 % in 2025.

India’s Growth Projections by other Organisations/Agencies:

i.Asian Development Bank (ADB) has increased its growth projection to 7% for FY25, compared to 6.7% (predicted in December, 2023).

ii.The World Bank revised its projection for FY25 to 6.6%, as against its January projection of 6.4%.

iii.In March 2024, S&P Global raised India’s FY25 growth forecast to 6.8%.

About International Monetary Fund(IMF):
Managing Director- Kristalina Georgieva
Member nations- 190
Headquarters- Washington D.C., United States of America(U.S.A.)
Established in 1944