BENGALURU (Reuters) -India’s economy is projected to grow at 6.3% in the current fiscal year and the next, the International Monetary Fund (IMF) said late Monday, supported by macroeconomic and financial stability.
The country’s digital public infrastructure and a strong government infrastructure program will continue to sustain growth, the IMF said in its Article IV consultation report, which reviews a country’s current and medium-term economic outlook.
“India has potential for even higher growth, with greater contributions from labor and human capital, if comprehensive reforms are implemented,” the IMF said.
The IMF’s growth projection for the current financial year, ending March 31, 2024, is lower than the 7% forecast by the Reserve Bank of India (RBI).
“Headline inflation is expected to gradually decline to the target although it remains volatile due to food price shocks,” the IMF said.
Volatile food prices pushed up retail inflation to 5.55% in November from 4.87% the previous month. While this was within the RBI’s tolerance band of 2%-6%, it remains above the target of 4%.
(Reporting by Rama Venkat in Bengaluru and Ira Dugal in Mumbai; Editing by Sherry Jacob-Phillips)
