The International Monetary Fund (IMF) in its latest World Economic Outlook, titled ‘Policy Support and Vaccines Expected to Lift Activity’ has projected India’s Gross Domestic Product (GDP) to contract by 8%(-8%) in FY20-21. Earlier in its October’s forecast, this estimate was -10.3%.
- It also projected India’s GDP growth at 11.5% in FY 21-22, which makes the country the only major economy of the world to register a double-digit growth 2021 amid the COVID-19.
- While in FY 22-23 the India’s GDP will be at 6.8%.
- The global economy is projected to grow by -3.5% in 2020.
- On the global front, the economy is projected to grow by 5.5% in 2021 from earlier 5.2%. The projection remained at 4.2% for 2022.
Highlights of the Outlook
i.The oil prices are expected to rise in 2021over 20% from the low base for 2020, however they will remain below their average for 2019.
ii.The Non-oil commodity prices will also increase with those of metals, in particular.
Growth in 2021
China will be next on the list after India, with 8.1% growth in 2021 followed by Spain (5.9 per cent) and France (5.5 per cent).
Point to Recall:
China is the only major country which had a positive growth rate of 2.3% in 2020.
Other Agencies GDP Estimates for India:
Fitch: -9.4%(2020-21); 11% (2021-22)
Organization for Economic Co-operation and Development (OECD): -9.9%(2020-21); 8%(2021-22)
CRISIL : -7.7%(2020-21); 10%(2021-22)
Recent Related News:
On December 15, 2020 Standard & Poors(S&P) Global Ratings has revised India’s real Gross Domestic Product (GDP) FY21 rate upwards to -7.7%(contract by 7%) from -9% projected earlier on rising demand and falling COVID infection rates. The growth of India will rebound to 10% in FY22.
About International Monetary Fund (IMF):
Managing Director and Chairman of the Executive Board – Kristalina Ivanova Georgieva Kinova from Bulgaria
Headquarters– Washington, DC, United States of America (USA)
Members– 190 countries