Economy in difficult times in India along with the whole world, IMF estimates - AB TAK NEWS


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Wednesday, 16 October 2019

Economy in difficult times in India along with the whole world, IMF estimates

Economy in difficult times in India along with the whole world, IMF estimates

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The International Monetary Fund (IMAF) says that for the first time since the financial crisis a decade ago, the economy of the whole world looks so sluggish.

The Monetary Fund estimates that this year the economy of the whole world will grow by only 3 percent.

At the same time, the growth rate in India will be reduced to 6.1 percent this year.

In April this year, the IMF had earlier talked about India's growth rate to be 7.3 percent.

Then in July, the institution reduced its estimate for India to 7 percent.

The impact of global economic slowdown on India

The IMF, in its latest report of the World Economic Outlook, cut India's economic growth estimate to 6.1 percent for 2019-2020.

However, the Monetary Fund has also expected some improvement in it in 2020-21.

IMF chief economist Geeta Gopinath said in a press conference on Tuesday that "the country's economic growth rate is expected to increase to a little over seven percent in 2020".

The IMF said in its new report "India's economic growth rate has declined because of the weakness of some non-banking financial institutions and the negative impact on consumer and small and medium-sized businesses' ability to borrow."

He said that the Indian government is working to improve the economy, but India will have to rein in its fiscal deficit.
The IMF has forecast economic growth for China this year at 6.1 per cent and 5.8 per cent in 2020.

China's economic growth rate in 2018 was 6.6 percent.

Global growth rate also decreased

According to the IMF, the global growth rate will be only 3 percent this year but it is expected to be 3.4 in 2020.

The IMF also said, "The global economy is in a phase of sluggishness and we are once again reducing the growth rate of 2019 to 3 percent, which is the lowest ever since the crisis of a decade ago. "

This is lower than its July global growth rate estimate. In July, it was stated to be 3.2 percent.

According to the IMF, the reason for the continuously decreasing growth rate is the weak domestic demand.

The IMF said, "The decline in economic growth rates is the main reason behind the decline in manufacturing sector and global trade, increase in import taxes and demand for production."

The IMF said that to deal with this problem, policy makers would have to end trade barriers, resume work on agreements and also reduce tensions between countries as well as eliminate uncertainty in domestic policies.

Will many countries of the world be affected?

The IMF believes that due to the slowdown in the global economy, the growth rate in 90 percent of the countries will be less this year.

The IMF has said that the global economy can grow to 3.4 percent in 2020.

However, it has also warned of many dangers for this growth as it depends on the economic recovery in India as well as the economy of Argentina, Turkey and Iran currently facing severe crisis.

"Any wrong policy at this time, such as no-deal Brexit or deepening trade disputes, can create serious problems for development and job creation," he said.

According to the IMF, in many cases, the biggest priority is to remove uncertainty or threats to development.

P. Chidambaram again targeted the government

Senior Congress leader P Chidambaram and former finance minister on Tuesday surrounded the government once again on the state of the economy, saying, "If the good economy takes one side then the Modi government on the other side."

Chidambaram is currently lodged in Tihar Jail in Delhi in a corruption related case. He congratulated Indian-origin economist Abhijeet Banerjee for winning the Nobel Prize and said that we should pay attention to what he has said about the Indian economy.

Rupee falls by 31 paise against dollar

On Tuesday, the rupee fell 31 paise to its lowest level in nearly a month due to the purchase of more dollars amid concerns related to trade talks between the US and China.

However, the decline in the price of crude oil by almost half a percent and the rise in the stock market has helped to reduce this loss.

On Tuesday, the rupee fell 31 paise or 0.44 per cent to close at 71.54 against the dollar. It had earlier closed at Rs 71.78 per dollar on 17 September.

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