IMF forecasts a 12.5 per cent growth rate for India in 2021; stronger than China

IMF forecasts a 12.5 per cent growth rate for India in 2021; stronger than China
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The International Monetary Fund Tuesday projected 12.5 per cent growth rate for India in 2021. This projection for India remains stronger than that of China.

IMF is a US-based global financial institution. It made the projections in its annual World Economic Outlook ahead of the annual Spring meeting with the World Bank.

As per reports, the Indian economy is expected to grow by 6.9 per cent in 2022.

India’s economy in 2020, contracted by a record eight per cent, the IMF said. The IMF projected an impressive 12.5 per cent growth rate for India in 2021.

Forecasts for China, on the other hand, show it to grow by 8.6 per cent in 2021 and 5.6 per cent in 2022.

As per the report, after an estimated contraction of 3.3 per cent in 2020, the projections for the global economy peg it to grow at 6 per cent in 2021.

Now countries need better-targeted measures to leave space for prolonged support. Moreover, there should be prioritising of health care spending. Along with the vaccinations, treatments, and health care infrastructure. Not only for India’s growth but elsewhere too.

Monetary policy should remain accommodative. Geeta Gopinath suggests that once the health threat is over, policy efforts can focus more on building resilient, inclusive, and greener economies.

Also, these priorities should be green infrastructure investment to help mitigate climate change, digital infrastructure investment and strengthening social assistance to arrest rising inequality.

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