INDIA remains the fastestgrowing economy in the world, according to the latest World Economic Outlook published by the International Monetary Fund. The country, it said, is projected grow at 5.9 per cent this fiscal, which is 7 basis point above of that of China.
The report highlights that China’s GDP is projected to grow by 5.2 per cent in 2023, while the growth forecast for the US is 1.6 per cent. In contrast, the projections for the UK and Germany are negative – at -0.3 per cent and -0.1 per cent, respectively.
Though India’s growth projection for 2023-24 has been reduced from 6.1 per cent to 5.9 per cent, the country’s successful Covid-19 vaccination programme and digitisation of transactions have been seen by the IMF as the major drivers of its economic recovery and job creation.
Driving global economy
The IMF also projects a 6.3 per cent growth for India in 2024, whereas China, it says, is slated to grow at a meagre 4.5 per cent. So, now it is the new ‘Hindu rate of growth’ which is going to drive the global economy in the coming years.
The term ‘Hindu rate of growth’ was coined by the late economist Raj Krishna in 1978 to describe India’s low rate of economic growth between the 1960s and 1980s, when it averaged around 4 per cent. While the term remains controversial, it is a reminder of the challenges India has faced in the past.
In a complete turnaround of the situation under the able leadership of Prime Minister Narendra Modi, India is now becoming an engine for global economic growth.
ADB projection
In a related development, the Asian Development Bank’s flagship economic publication, Asian Development Outlook April 2023, has projected that India’s GDP growth will moderate to 6.4 per cent in FY2023 and rise to 6.7 per cent in FY2024. The World Bank, however, projects India’s GDP growth for the same fiscal year to be slightly lower at 6.3 per cent.
The Boao Forum for Asia (BFA), Beijing’s prominent official think-tank, has also stated that India and China will contribute to half of the world’s growth this year.
The country’s strong growth
