April 16, 2024 – The International Monetary Fund (IMF) has raised India’s fiscal year 2024-25 (FY25) GDP growth forecast to 6.8%, an increase from the previous projection of 6.5%. This adjustment reflects India’s strong domestic demand and expanding working-age population, solidifying its position as the world’s fastest-growing major economy.
For FY26, the IMF anticipates India’s GDP growth will stabilize at 6.5%. The global financial institution also projects a decrease in retail inflation to 4.6% in FY25 and to 4.2% in FY26. These projections are part of the IMF’s latest World Economic Outlook report, published ahead of the annual spring meetings of the IMF and the World Bank.
The IMF’s report forecasts a moderate decline in growth across emerging and developing Asia, with rates expected to fall from 5.6% in 2023 to 5.2% in 2024, and to 4.9% in 2025. Conversely, China’s growth is projected to decline from 5.2% in 2023 to 4.6% in 2024 and 4.1% in 2025.
Despite these challenges, the IMF points to India’s resilience and its ability to thrive amid global economic headwinds such as high inflation and softening demand in China and Europe. The United States, another global economic powerhouse, is forecasted to grow at 2.7% in 2024 and 1.9% in 2025.
In contrast, the Eurozone’s forecast for 2024 saw a slight downward revision due to weak consumer sentiment in Germany and France. The IMF’s forecast for China’s 2024 growth remains unchanged at 4.6%, with a further dip to 4.1% in 2025, amid ongoing concerns about the country’s property sector.
Brazil is another emerging market receiving positive attention in the report, with its 2024 growth forecast lifted by half a percentage point to 2.2%. The IMF highlights these emerging markets’ increasing influence in driving global economic growth.
Meanwhile, low-income developing countries continue to face hurdles with their post-pandemic recoveries and ongoing economic challenges. Their combined 2024 growth forecast was revised down to 4.7% from the previous estimate of 4.9% in January.
Overall, the IMF’s World Economic Outlook points to India’s ongoing growth prospects and its vital role in propelling the global economy, even amid ongoing global uncertainties.
