Taking it to Twitter, the International Monetary Fund (IMF) lowered India’s gross domestic product growth (GDP) on Tuesday, 11th October 2022. The organization that promotes stability in the international market initially projected that India would experience a GDP growth of 7.4% in the financial year 2022-23. However, according to its latest projection, India will experience a downfall of 0.6%, taking the GDP growth rate to 6.8%.
The downfall in the growth percentage is said to be a result of stubborn inflation, the Russia-Ukraine war, and increasing interest rates. In the Twitter thread, IMF stated that the outlook for India is for growth of 6.8%, seeing a downgrade since the July forecast which reflects a weaker-than-expected outturn in the second quarter. It also stated that there’s no change in the subdued external demand which reflects a 6.1% growth rate in 2023.
Predicting a recession in the coming financial year the world economic forum expressed that this is the weakest growth profile for the global economy since 2001, excluding the financial crisis faced globally during the COVID phase. It also reflects a significant slowdown in some of the largest economies of the world including the USA, Euro Area, Germany, France, Italy, the United Kingdom, and Japan.
The global monetary organization has also hinted that some lenders in emerging markets may not have sufficient capital to meet the requirements during the upcoming recession next year.
While most of the world economies face a 50% slash by the IMF, India has continued progressing to be Asia’s largest growing economy with a 10% slash in the projected GDP growth.