New Delhi, Apr 12 (KNN) International Monetary Fund division chief Daniel Leigh on Tuesday said that India is one of the bright spots in the global economy right now with a high growth rate.

Although IMF lowered its growth projection for 2023-24 to 5.9 per cent from 6.1.

"Yes, we have a growth rate for India which is 6.8 in 2022. Let's not forget this is one of the bright spots in the global economy right now. Such a high growth rate and it is moderating down to 5.9 with a -.2 revision compared to January, what's happening here is also a set of historical revisions," said Leigh.

Leigh added that 2020-2021 has been actually a lot better than we thought, so there's less room for catching up. 

“And that pent-up demand from consumers that were informing our previous forecast is therefore going to be less because they've already had more catching up before. So that's why there's a downward revision this year,” he said.

He pointed out that the Indian economy is expected to grow 6.3 next year again.

The IMF projects India's inflation to slow to 4.9 per cent in the current year and further to 4.4 per cent next fiscal year.

It’s growth forecast is lower than the Reserve Bank of India (RBI) projection. 

The central bank predicted 7 per cent GDP growth for FY 2022-23 and 6.4 per cent in the ongoing fiscal that started on April 1.

Meanwhile, the international lender flagged concerns about inflation, debt and risks to the financial sector from rising interest rates. It warned that if banks cut lending further, the global output will reduce by another 0.3 percentage point in 2023.

IMF projects growth to bottom out at 2.8 per cent in 2023, picking up to 3 per cent in 2024. Inflation is expected to stay elevated at 7 per cent for the rest of the year, before declining to 4.9 per cent next year.  (KNN Bureau)