The International Monetary Fund, IMF has said that India is expected to grow at 7(point)4 per cent in 2018 and 7(point)8 per cent in 2019 and would re-emerge as one of the fastest growing major economies in the period.
The IMF explained this is due to the strong private consumption as well as fading transitory effects of the currency exchange initiative and implementation of the national goods and services tax.
It said the growth is picking up after falling sharply in the second quarter of 2017 due to one-off factors.
The world agency said India will leave its nearest rival China which will grow at 6.6 in 2018 and 6.4 per cent in 2019.
IMF said, two major economic reforms, demonetisation and GST, resulted in a slightly lower growth rate of 6.7 per cent in 2017. It said that India’s projected growth provide some offset to China’s gradual slowdown.
According to the IMF, India has made progress on structural reforms in the recent past, which will help reduce internal barriers to trade, increase efficiency, and improve tax compliance. The report, however, said, while the medium-term growth outlook for India is strong, an important challenge is to enhance inclusiveness.
Source: AIR