IMF cuts India's growth forecast for 2022 to 6.8 percent from 7.4%

The International Monetary Fund (IMF) has reduced India's economic growth forecast for the year 2022 to 6.8 percent. Earlier in July, the IMF had projected India's growth rate to be 7.4 percent. However, that estimate was also lower than the growth forecast of 8.2 per cent in January this year. India's economic growth rate has been 8.7 percent in the financial year 2021-22. The IMF, in its latest report released on Tuesday on the world economic scenario, said that India's growth rate this year is likely to remain at 6.8 percent. This is 0.6 percent lower than the previous estimate expressed in July.

This indicates a weaker than expected economic activity in the second quarter and a moderation in external demand. Before this, many other institutions like the World Bank have also cut India's growth forecast. The World Bank last week lowered India's economic growth forecast to 6.5 percent from 7.5 percent. The IMF has also projected global economic growth to be 3.2 percent in the year 2022, which will be the slowest growth in the new century. Global growth stood at 6 per cent in 2021 but is expected to slip to 2.7 per cent next year. The Monetary Fund said in its report that the fall in this estimate is directly related to the widespread slowdown in the large economy. According to this, America's gross domestic product (GDP) shrank in the first half of 2022, the economy of European countries contracted in the second half and the outbreak of Covid-19 in China still persists.

IMF Research Director and Economic Adviser Pierre Oliver Gorinches said in the lead of this report that the global economy still faces great challenges. He said, "Russian attacks on Ukraine, difficulties in living from inflationary pressures and slowdown in China are having many effects." . He said, "The world's three big economies - the US, the European Union and China will remain frozen. In short, the worst is yet to happen. For many, the year 2023 will feel like a recession."