The International Monetary Fund (IMF) lowered India’s GDP projection from 8.2 per cent to 7.4 per cent.
In April, IMF had cut the growth forecast of India from 9 per cent estimated in January to 8.2 per cent.
The International financial institution has cited vulnerability of the Indian economy to external shocks and rapid monetary policy tightening as reasons behind the change in its World Economic Outlook Update July 2022 report.
For the next fiscal year (FY24) it has also cut India’s growth forecast to by 0.8 per cent points to 6.1 per cent.
However, for this financial year, India remained the second fastest growing economies across the world behind Saudi Arabia, which is likely to grow by 7.6 per cent in 2022-’23.
In its global growth outlook the IMF has also decreased it from estimated 3.6 per cent in April to 3.2 per cent.
Pierre-Olivier Gourinchas, Chief Economist at IMF wrote in a blog that the world could be teetering on the edge of a global recession as the global economic output has depreciated since April.
According to the IMF report the global output is expected to slow down at 2.9 percent in 2023 because of the increased interest rates issued by central banks to contain inflation.