India to grow at 11.5% in FY 21: IMF

As per the International Monetary Fund (IMF), India is to become the fastest growing economy during FY21, with the expectation to grow at 11.5%. Indian economy during FY21 is expected to experience strong recovery after the contraction in growth brought by the COVID-19 pandemic. Furthermore, IMF have forecasted growth of 6.8% for Indian economy during FY23. As per the World Economic Outlook (WEO) update, the economies are expected to recover due to policy support and vaccination.

IMF has revised the forecast for Indian economy for FY22 from 8.8% predicted in October 2020. It comments, “Notable revisions to the forecast include the one for India (2.7 percentage points for 2021 [FY22]), reflecting carryover from a stronger-than-expected recovery in 2020 after lockdowns were eased.” The revisions are due to upside surprise in GDP of July-September quarter. 

Furthermore, IMF predicts the growth of 5.5% in 2021 and 2.2% in 2022 for the world economy. The world output experienced a narrower contraction of 3.5% in 2020 in contrast to 4.4% contraction experienced earlier, exhibiting stronger recovery in H2 2020. The international financial institution, furthermore, comments that the approval of multiple vaccines and mass immunisation are expected to lower the transmission of the virus across the world. However, the pandemic is also expected to undo the improvement made in reducing poverty over the past 20 years.