The International Monetary Fund (IMF) has once again slashed estimates for India’s growth rate in FY 2019-20. According to the latest IMF estimates, India’s GDP will grow at 6.1 percent this year. It was earlier estimated to be 7.3 per cent in April. Earlier in September, the IMF had expected economic growth to be 7 percent in the financial year 2019-20. It was cut by 0.30 percent. In this context, the IMF has stated that India’s economic growth rate was weaker than anticipated due to corporate and regulatory uncertainties and weakness of some non-banking financial institutions.
Growth rate at six year low
According to the government’s data, India’s economic growth rate reached an all-time low of 5 per cent in the April-June quarter. The figure was eight per cent in the same quarter last year.
IMF spokesman Gerry Rice said, “The US-China trade war has shocked the global economy.” This is expected to reduce global GDP growth by 0.8 percent next year.
The central government’s exercise to make the country a five trillion economy could also be affected by the projected growth rate. If there is a slowdown or slow pace in the economy, then it will be seen in future also. At present, production in many sectors in the country has almost come to a standstill. This is because people are not buying the old stock either. Efforts will have to be sustained to accelerate growth to create a five trillion economy.
World Bank also reduced estimates
Prior to the IMF, the World Bank also lowered its GDP estimate to six per cent on Sunday. This may shock the Narendra Modi government of the Center. According to the World Bank, India’s growth rate could be six percent. Whereas the growth rate in the year 2018-19 was 6.9 percent. The World Bank says that the growth rate may come back to 6.9 percent in 2021. At the same time, it may improve further in 2022. India’s growth in 2022 is estimated to be 7.2 percent.