APD | Indian economy slowed down in 2019: IMF

By APD writer Rishika Chauhan

New Delhi, Feb. 1, (APD) - The Managing Director of International Monetary Fund, Kristalina Georgieva on Friday said that the Indian economy slowed down in 2019, however, it is not in a recession.

Speaking to journalists, she explained that there were disturbances in the economy due to reform measures adopted by the government, like the imposition of Goods and Services Tax and currency demonetization.

She said, “The Indian economy indeed has experienced an abrupt slowdown in 2019. We had to revise our growth projections, downwards to four percent for last year. We are expecting 5.8 percent (growth rate) in 2020 and then an upward trajectory to 6.5 percent in 2021.”

“It appears that the main reason for this slowdown was the non-banking financial institutions experiencing turbulence,” she further said.

Showing faith in the recent reforms, she believed that in the long run the reforms would be beneficial to India, but would slow down the economy in the short-term.

In the medium-term, she clarified, the IMF remained optimistic about the Indian economy’s growth.

Georgieva, believed that there is fiscal space in India and the government has made prudent policies. The new budget would further determine the Indian economy’s growth, she added.

(ASIA PACIFIC DAILY)