India growth forecast goes down yet again

The International Monetary Fund has said that while India has worked on the fundamentals of its economy, there are many problems that need to be looked into.

The IMF has reduced India’s growth forecast by 90 basis points to 6.1%. This is the second downward revision in seven months.

India has worked on the fundamentals (of its economy), but there are problems to be addressed. In the financial sector, especially non-banking institutions, there are steps taken now to consolidate banks. They ought to help resolve some of these issues. –Kristalina Georgieva, Managing Director, International Monetary Fund

The IMF said that investment in human capital should be a top priority for India. “It has to continue bringing women in the labour force. It is very important. India has very talented women, but they stay at home,” said Georgieva. She also said that structural reforms are a priority for India. “We expect to see those reforms continue”.

In response, Union Finance Minister Nirmala Sitharaman said that India remains among the fastest growing economies of the world and efforts are being made to make it grow faster.

The minister is in the United States for an annual meeting of the IMF. “The IMF (in its latest projections) reduces the growth (rate) for all the global economies. It reduces the growth for India too. But even with that, India is still growing as the fastest growing economy,” she said.

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