Finance & Economics

IMF Forecasts Increase in India’s Contribution to Global Economic Growth

The International Monetary Fund predicts that India’s contribution to global economic growth will increase over the next five years.

IMF Forecasts Increase in India's Contribution to Global Economic Growth

The experts of this organization justify their vision of the future of the mentioned South Asian country in the context of the global economic system by the fact that at present the corresponding indicators of this state show an increase, which is characterized by a high level of intensity.

Krishna Srinivasan, Director of the IMF’s Asia and Pacific Department, told reporters in Mumbai last Thursday, October 19, that India’s share in the structure of global economic growth is likely to reach 18% by 2028. Currently, this figure is 16%.

An important circumstance in this case is that the rapid growth of the Indian economy is recorded against the background of a slowdown in a similar process in China. According to experts, this state of affairs may lead to the fact that New Delhi’s share in the global economy will be higher than the scale of Beijing’s contribution to this system. It is not yet known whether this option of the alignment of forces in the case of the implementation of the corresponding scenario will be long-term.

The latest IMF data suggests that China is a more powerful competitor to India in the economic aspect only temporarily. At the same time, in terms of size, the Chinese economy remains the dominant system in the framework of comparative analysis. The latest IMF estimates suggest that China’s gross domestic product will increase to $23.61 trillion by 2028. A similar Indian figure will reach $5.94 trillion by the specified term.

The IMF also claims that this year and next, India and China together will provide about half of the world’s economic growth.

At the same time, HSBC economists Frederic Neumann and Justin Feng said in a report published last week that New Delhi is far from matching Beijing in terms of contribution to the global economy. In this case, experts pay attention to the share of India and China in global investment and consumption. They also justify their position by comparing the two economic systems in terms of size. From the point of view of the mentioned criteria, Beijing has a clear advantage.

The IMF predicts that India’s economy will show growth of 6.3% this year and maintain this pace of positive dynamic in 2024. The experts of this organization also claim that the Asia-Pacific region will be the most dynamic in the world in the foreseeable future. This year, economic growth in the mentioned region is projected to be 4.6%. In 2024, this dynamic is expected to decline to 4.2%. In the medium term, growth is projected at 3.9%.

As we have reported earlier, Real Estate Crisis to Stop Development of China’s Economy for Years.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.