Recently, the Center has reduced the financial growth forecast for the current financial year to 7 percent from the previous 8 percent-8.5 percent. Chief Financial Adviser to the Government V Ananth Nageswaran fears again, that it may become 6.5 percent where the growth of the last financial year was 8.7%. Reserve Bank estimates, GDP will grow at 6.8%. In this scenario, the World Bank slightly increased its forecast for India.
However, in the next financial year (2023-24), the growth may come down to 6.6 percent. In the following financial year (2024-25) it will be even lower, at 6.1%. It also warned that the slowdown in the global economy and growing uncertainty will push the country’s export and investment growth.
Stance of IMF
Earlier the International Monetary Fund (IMF) also cut India’s growth rate to 6.8% from 7.4%. According to the concerned circles, these forecasts are keeping the country’s economy apprehensive. Especially since the prices of various essential commodities, including fuel, are still quite high. Unemployment is also high. The purchasing power of ordinary earners is at the bottom. Exports have been hit by the global economic crisis. However, Prime Minister Narendra Modi on Wednesday has informed the abroad Investors again that the economic base is strong. Positive messages from the IMF and the World Bank have been raised in the face of questions about the deceleration of the growth wheel.
The World Bank in its report praised India’s move to boost government spending on infrastructure and address industry. It claimed that GDP grew by 9.7% year-on-year in the first half of the year, indicating an increase in demand. The report expects India to remain the fastest growing economy among the seven largest potential and developing markets.
Modi joined the opening ceremony of the World Investor Conference in Madhya Pradesh through the net and said that the foundation of the Indian economy is solid. The IMF sees the country as a bright spot around the world. The World Bank has also said that the situation here is better than many other countries in handling the storms of the international world. His government has also made India one of the investment destinations through eight years of successive reforms.
Wrapping up
But the message that the world economy is in crisis, is clear. The IMF raised concerns last week. It said that large economies like the US, Europe and China will have a negative impact everywhere. World Bank has said the same thing in its annual report. It also warned of the risk of the world economy falling into recession. That is why they fear that India’s progress will slow down in the next two financial years. According to the World Economic Forum, the biggest risk facing the world in the short term is the cost of living. According to the concerned quarters, India will have to find a way to deal with issues like high price hikes, wide trade and current account deficits, sluggish exports, sluggish income growth in the coming financial year.