IMF retains FY17 India GDP forecast at 7.5%, cuts world growth

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The International Monetary Fund (IMF) today kept India's growth projection unchanged at 7.3% in the current fiscal and 7.5% in the next, even as it cut world economic outlook to 3.4% for 2016.

In its update on World Economic Outlook (WEO), IMF said China's growth would slow to 6.3% in 2016 and further to 6% in 2017, but India would continue to grow at a "robust pace".

"India and the rest of emerging Asia are generally projected to continue growing at a robust pace, with some countries facing strong headwinds from China's economic rebalancing and global manufacturing weakness," IMF said.

As for the world growth, IMF today forecast 3.4% for 2016 and 3.6% for 2017.

For India, it retained the growth forecast at 7.3% for the current fiscal and 7.5% for 2016-17 and 2017-18.

"Risks to the global outlook remain tilted to the downside and relate to ongoing adjustments in the global economy: a generalised slowdown in emerging market economies, China's rebalancing, lower commodity prices, and the gradual exit from extraordinarily accommodative monetary conditions in the United States," IMF added.

"If these key challenges are not successfully managed, global growth could be derailed," it cautioned.

IMF said the pick-up in global activity is projected to be more gradual than in the October WEO, especially in emerging market and developing economies.

In the last WEO update released in October, IMF had projected India to grow at 7.3% in the current fiscal and 7.5% in 2016-17. As for world growth, it had put the figures at 3.6% for 2016 and 3.8% for 2017.

Emerging market and developing economies account for over 70% of the global growth.

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