The Reserve Bank of India’s (RBI) has forecast 7.2 per cent gross domestic product (GDP) growth for fiscal 2022-23.

The IMF recently revised down India’s economic growth forecast to 6.8 per cent for this year—steep relative to its last July forecast of 7.4 per cent—reflecting a weaker-than-expected outturn in the second quarter and more subdued external demand. For 2023, the country has been projected to grow at 6.1 per cent in the latest annual World Economic Outlook.

Cautioning major economies about an expected slowing of global growth further next year, the IMF report projected global growth will slow from 6 per cent in 2021 to 3.2 per cent in 2022 and 2.7 per cent in 2023—the weakest since 2001, except for the global financial crisis and the acute phase of the COVID-19 pandemic.

“The worst is yet to come and, for many people 2023 will feel like a recession,” said IMF economic counsellor Pierre-Olivier Gourinchas.

Global inflation is forecast to rise from 4.7 per cent in 2021 to 8.8 per cent in 2022 but to decline to 6.5 per cent in 2023 and to 4.1 per cent by 2024. Upside inflation surprises have been most widespread among advanced economies, with greater variability in emerging market and developing economies.

IMF managing director Kristalina Georgieva has cautioned that the ‘risks of recession are rising’ around the world and the global economy is facing a ‘period of historic fragility’.

The IMF has cut forecasts for the United States, the European Union and China as well. US GDP growth is pegged at 1.6 per cent this year, 0.7 points below the July forecast, due to an unexpected contraction this year.

Citing deteriorating international environment, the World Bank also downgraded India’s growth forecast to 6.5 per cent for fiscal 2022-23 recently, a drop of 1 per cent from its June projection.

Fibre2Fashion News Desk (DS)