India's growth to surpass the growth of China in the next two years: UN report
Updated: May 20, 2015 01:08:29pm
New Delhi, May 20 (KNN) India is projected to grow by 7.6 per cent in 2015 and 7.7 per cent in 2016, surpassing the growth of China, says UN in its report.
According to a press release by UN DESA on ‘World Economic Situation and Prospects (WESP): Mid 2015 Update’, “South Asia’s economic outlook is largely favourable. Most economies are expected to experience a strengthening of growth in 2015-2016 on the back of stronger domestic consumption and investment, and a pick-up in exports.”
The release further said, “India, in particular, is now projected to grow by 7.6 per cent in 2015 and 7.7 per cent in 2016, surpassing the growth of China, which is pegged at 7 per cent in 2015 and 6.8 per cent in 2016.”
The world economy continues to grow at a modest pace, with a gradual improvement projected for the second half of 2015 and 2016, according to the United Nations WESP as of mid-2015 report, launched on Tuesday.
Growth of world gross product is projected to improve slightly from 2.6 per cent in 2014 to 2.8 per cent in 2015—a downward revision by 0.3 percentage points from the forecast presented in the WESP 2015 in January.
The downward revision reflects mainly deterioration in the prospects of the economies in transition and several large developing countries, especially in South America. In 2016, global growth is forecast to improve to 3.1 per cent, which is still well below the pre-crisis pace, said WESP release.
“The current world economic situation is characterised by five ‘lows’: low growth, low trade flows, low inflation, low investment, and low interest rates, combined with two ‘highs’: high equity prices, and high debt levels”, remarked Pingfan Hong, Director of the Development Policy and Analysis Division (DPAD) of the United Nations Department of Economic and Social Affairs (DESA).
The report notes that the growth divergence between the various regions will likely widen this year. WESP attributes this in part to the differing impacts from the recent drop in the prices of oil and other commodities. The short-term growth prospects of most commodity-exporting economies have been downgraded; by contrast, commodity-importers tend to benefit from the lower prices in the form of reduced inflationary, fiscal and balance-of-payment pressures.
The report warns of still significant downside risks to the forecast related to the impact of the upcoming monetary policy normalization in the United States, ongoing uncertainties in the euro area, potential spill overs from geopolitical conflicts and persistent vulnerabilities in emerging economies. These individual risk factors are interconnected and could be mutually reinforcing, potentially leading to a weaker-than expected expansion of the global economy.
The overall subdued performance of the world economy since the global financial crisis has raised concerns of a “new normal” of lower growth. The broad-based weakness in investment worldwide not only holds back current growth, but also reduces potential growth in the future.
“It is somewhat concerning that, despite highly accommodative monetary policies and historically low global interest rates, real investment has been weak in many parts of the world since the global financial crisis”, said Ingo Pitterle, the DPAD’s team leader for the report.
Average growth in developing countries is expected to remain at 4.4 per cent, about 3 percentage points below the pre-crisis pace.
The least developed countries (LDCs) are expected to see growth of 4.9 per cent in 2015, a deceleration from 5.2 per cent in 2014 and a marked downward revision by 0.8 percentage point compared to the previous forecast. However, growth in some LDCs, such as Ethiopia, Rwanda and Tanzania, has been robust and sustained, owing in part to investments in agriculture and infrastructure, expanding services sectors and rising domestic demand.
The WESP report identifies key challenges in the areas of monetary, fiscal, labour market and trade policies, underlining the need for strengthened international policy coordination.
WESP underscores such coordination becomes ever more critical as the Member States of the United Nations are expected to adopt a new financing framework for sustainable development, an ambitious sustainable development agenda, and a universal agreement on climate change later this year, said the release. (KNN Bureau)
According to a press release by UN DESA on ‘World Economic Situation and Prospects (WESP): Mid 2015 Update’, “South Asia’s economic outlook is largely favourable. Most economies are expected to experience a strengthening of growth in 2015-2016 on the back of stronger domestic consumption and investment, and a pick-up in exports.”
The release further said, “India, in particular, is now projected to grow by 7.6 per cent in 2015 and 7.7 per cent in 2016, surpassing the growth of China, which is pegged at 7 per cent in 2015 and 6.8 per cent in 2016.”
The world economy continues to grow at a modest pace, with a gradual improvement projected for the second half of 2015 and 2016, according to the United Nations WESP as of mid-2015 report, launched on Tuesday.
Growth of world gross product is projected to improve slightly from 2.6 per cent in 2014 to 2.8 per cent in 2015—a downward revision by 0.3 percentage points from the forecast presented in the WESP 2015 in January.
The downward revision reflects mainly deterioration in the prospects of the economies in transition and several large developing countries, especially in South America. In 2016, global growth is forecast to improve to 3.1 per cent, which is still well below the pre-crisis pace, said WESP release.
“The current world economic situation is characterised by five ‘lows’: low growth, low trade flows, low inflation, low investment, and low interest rates, combined with two ‘highs’: high equity prices, and high debt levels”, remarked Pingfan Hong, Director of the Development Policy and Analysis Division (DPAD) of the United Nations Department of Economic and Social Affairs (DESA).
The report notes that the growth divergence between the various regions will likely widen this year. WESP attributes this in part to the differing impacts from the recent drop in the prices of oil and other commodities. The short-term growth prospects of most commodity-exporting economies have been downgraded; by contrast, commodity-importers tend to benefit from the lower prices in the form of reduced inflationary, fiscal and balance-of-payment pressures.
The report warns of still significant downside risks to the forecast related to the impact of the upcoming monetary policy normalization in the United States, ongoing uncertainties in the euro area, potential spill overs from geopolitical conflicts and persistent vulnerabilities in emerging economies. These individual risk factors are interconnected and could be mutually reinforcing, potentially leading to a weaker-than expected expansion of the global economy.
The overall subdued performance of the world economy since the global financial crisis has raised concerns of a “new normal” of lower growth. The broad-based weakness in investment worldwide not only holds back current growth, but also reduces potential growth in the future.
“It is somewhat concerning that, despite highly accommodative monetary policies and historically low global interest rates, real investment has been weak in many parts of the world since the global financial crisis”, said Ingo Pitterle, the DPAD’s team leader for the report.
Average growth in developing countries is expected to remain at 4.4 per cent, about 3 percentage points below the pre-crisis pace.
The least developed countries (LDCs) are expected to see growth of 4.9 per cent in 2015, a deceleration from 5.2 per cent in 2014 and a marked downward revision by 0.8 percentage point compared to the previous forecast. However, growth in some LDCs, such as Ethiopia, Rwanda and Tanzania, has been robust and sustained, owing in part to investments in agriculture and infrastructure, expanding services sectors and rising domestic demand.
The WESP report identifies key challenges in the areas of monetary, fiscal, labour market and trade policies, underlining the need for strengthened international policy coordination.
WESP underscores such coordination becomes ever more critical as the Member States of the United Nations are expected to adopt a new financing framework for sustainable development, an ambitious sustainable development agenda, and a universal agreement on climate change later this year, said the release. (KNN Bureau)
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