WORLD ECONOMIC OUTLOOK BY IMF

WORLD ECONOMIC OUTLOOK BY IMF

Context:

On 25 January 2022, the International Monetary Fund (IMF) released its World Economic Outlook.

World Growth:

• According to the report, global economic growth will decrease by half a percentage point less than previously predicted.
• Growth will fall from 5.9% in 2021 to 4.4% in 2022 and further reduce to 3.8% by 2023.

India's Growth:

• According to IMF forecasts, India will grow by 9% in 2021-2022. In October 2021, the IMF estimated India's growth potential at 9.5% for the year. 
• IMF now projects 9% growth for India's economy in 2022-23. The October survey projected growth at 8.5% in 2022-23 and 7.1% in 2023-24.
• India's prospects for 2023 are estimated based on the expected development of debt growth. 

Impact of Omicron variant:

• According to the IMF, countries have reimposed travel restrictions during the emergence of the Omicron Covid-19 variant. 
• Rising energy prices and supply disruptions have led to higher and broader inflation expectations, both in the United States and in other developing economies and emerging markets. 
• Ongoing reduction of the real estate sector in China and the rapid acquisition of private equity have also limited the prospects for growth.