In a notable development, the International Monetary Fund (IMF) has revised its GDP growth estimate for India to 6.7% for the current financial year, marking a 40 basis points increase from its earlier forecast of 6.3%. This optimistic adjustment is attributed to robust public investment and favorable labor market outcomes, as highlighted in the latest World Economic Outlook report.
Medium-Term Growth Outlook Raised
IMF also raised India’s upward medium-term GDP growth to 6.5%, representing a 20 basis point upgrade from its October 2023 forecast. This positive adjustment extends to the years 2025 and 2026, indicating sustained economic momentum.
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Current Account Deficit Projection Narrowed
The IMF anticipates India’s current account deficit for FY 24 to decrease from the initial projection of 1.8% of GDP to 1.6%. This reflects a healthier economic balance and improved fiscal dynamics.
India Remains the Fastest-Growing Major Economy
Despite global economic challenges, India continues to outpace other major economies, maintaining its position as the fastest-growing among them. In the preceding financial year (FY 23), India’s GDP had expanded impressively by 7.2%, reinforcing its resilience and economic vitality.