The International Monetary Fund (IMF) is the latest to join several other global financial institutions to predict India’s Gross Domestic Product (GDP) to grow at over 7 percent in 2018, making it the fastest among emerging economies following last year’s slowdown due to demonetisation and the implementation of Goods and Services Tax (GST).
In its latest World Economic Outlook update released on Monday, 22 January ahead of the World Economic Forum in Davos, the IMF projected India’s GDP growth rate at 7.4% in 2018. But before the IMF, several other financial institution gave strong economic growth forecast for India.
In a report titled ‘World Economic Situation and Prospects 2018’, the United Nations had said India's economy is expected to grow at 7.2 percent, driven by robust private consumption and sound macroeconomic policies.
The World Bank also pointed out that India has “enormous growth potential” as it projected country’s growth rate to 7.3 percent in 2018.
Investment banking company Goldman Sachs’s projection remains the highest at 8 percent. Other positive predictions by leading financial services companies include Morgan Stanley (7.5%), Moody's (7.6%), HSBC (7%), Bank of America Merrill Lynch (7.2%) and Nomura (7.5%).
The Narendra Modi-led government had been on the receiving end of criticism after India’s growth rate slowed down to three-year low of 6.7 percent in 2017 inching 0.1 percent behind China’s growth rate for the year.
Following announcements of 2018 predictions, like the one by Moody’s, several Cabinet ministers, including Finance Minister Arun Jaitley, were quick to praise the economic reforms by the government.
In an interview with a news channel recently, PM Modi said “India’s fast growth and democratic values are the reason why the general public’s interest in GDP numbers is so high.”
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