India Economic Growth projected to be 4.5 percent by IMF

International Monetary Fund (IMF) released its World Economic Outlook report on 21 January 2014. The IMF projected the Indian economy’s growth at 4.5 percent for 2013-14 which is much less than ASEAN countries such as Indonesia, and Philippines.

IMF in its earlier report in October 2013 had projected that Indian economy would grow by 3.8 percent in 2013-14. The lower growth rate of 3.8 percent was caused due to global slowdown and domestic factors like interest rates.

However, with India receiving a favourable monsoon and higher export revenues since October 2013, the growth in the second largest economy of Asia picked up. The growth is expected to firm further on strong structural polices supporting investment. The economic growth rate can expand up to 5.4 percent and 6.4 percent in next two fiscals.

The ASEAN countries Indonesia, Malaysia, Philippines, Thailand and Vietnam had grown by 5.7 percent in 2012. The Economic growth in Indonesia and the Philippines are due to strong fundamentals such as strong consumption and investment, diversified exports and low policy rates.