But still the IMF’s assessment of the Indian economy is, ‘India’s economy has recovered from the shock of the Covid infection.’ According to their report, the real GDP growth rate is 8.7 per cent in 2021-22. Which is higher than the pre-Covid period. The growth rate continues in the current financial year as well. That is because the labor market has turned around and there is demand for credit in the private sector. That is why there is flow of money in the market. The report also states that the rate of new COVID cases is low. Also, the vaccine uptake rate is good. Free booster shots will help improve vaccine coverage.
According to international organizations, the Indian government’s policies are capable of facing the new economic turmoil. These include a range of issues—including inflationary pressures, global financial conditions, the outcome of the war in Ukraine and sanctions on Russia, and the slowing pace of growth in China and advanced economies. Elaborating on India’s growth, the IMF said real GDP is projected to grow at 6.8 percent and 6.1 percent in 2022-23 and 2023-24, respectively.
Inflation will be 6.9 percent in 2022-2023. Inflation may then gradually ease, the IMF said. The current account deficit is expected to widen to 3.5 percent of GDP in 2022-23.
Not only the IMF, several international organizations have expressed hope about India’s economic growth in their reports. But they are equally concerned about the global economic situation. In particular, the way the US Fed Reserve is increasing interest rates to control inflation, it is known that the final negative impact will be on the world economy.