India: IMF predicts low growth in 2017

By APD writer Rishika Chauhan

**NEW DELHI, October 11 (APD) ** - The International Monetary Fund (IMF) on Tuesday predicted that India’s growth rate would be low in 2017.

Forecasting a growth rate of 6.7%, IMF blamed effects of demonetization, announced in November last year and the outcome of the newly launched goods and services tax (GST) for the low growth in 2017.

However, IMF also informed that the structural reforms undertaken by Prime Minister Narendra Modi’s government would be beneficial in the long run as it would lead to recovery, delivering in the medium term a growth of above 8%.

According to the report, “a gradual recovery in India’s growth trajectory is a result of implementation of important structural reforms, which promises the unification of India’s vast domestic market, is among several key structural reforms under implementation that are expected to help push growth above 8% in the medium term.”

In its document, World Economic Outlook, IMF said, “the world economy is experiencing a cyclical upswing that began midway through 2016. India’s economy will recover sharply in 2018 to grow 7.4%, still 30 basis points lower than its earlier estimate in April.”

“In India, growth momentum slowed, reflecting the lingering impact of the authorities’ currency exchange initiative as well as uncertainty related to the midyear introduction of the countrywide Goods and Services Tax,” IMF further explained.

(ASIA PACIFIC DAILY)