IMF reduces India's growth forecast for current fiscal year

New Delhi: The International Monetary Fund (IMF) predicted on Tuesday that India’s economy will expand by 5.9% in the current fiscal year, but it also issued a warning that the banking system’s instability may harm global growth.

The IMF predicted global real GDP growth of 2.8% for 2023 and 3% for 2024 in its Global Economic Outlook, a substantial drop from 3.4% growth in 2022 because of stricter monetary policies.

“With the recent increase in financial market volatility, the fog around the world economic outlook has thickened,” the IMF said as it and the World Bank launched spring meetings this week in Washington.

In the 2023–24 fiscal year, the IMF projected that India’s GDP would expand by 5.9%, which was 0.2% less than its January projection and significantly less than the 6.5% growth rate that the Indian central bank had predicted.