Business Desk. International Monetary Fund (IMF) Managing Director Kristalina Georgieva has said that India’s place in the world economy remains bright and it alone will contribute 15 percent of global growth in 2023. He said that digitization has brought the world’s fifth-largest economy out of the crisis of the pandemic.
Referring to the government’s efforts to revive the economy, he said that prudent fiscal policy and provisions made in the budget are important for capital investment and will help in maintaining the pace of growth along with financing.
Fastest growth rate among major economies
The IMF Chief has said that ‘India’s performance has been very impressive. We expect India to maintain a high growth rate of 6.8 percent for the fiscal year ending March. For the financial year 2023/24 (April 2023 to March 2024), we estimate 6.1 percent.
Georgieva told news agency PTI in an interview that India’s growth, like all economies of the world, has slowed down a bit, but it remains above the global average. India is expected to provide around 15 percent of global growth in 2023. This is the fastest growth rate among major economies.
India is a shining star
Amid fears of a recession, India remains a bright spot at a time when the IMF is projecting a tough 2023. This is a time when global growth has come down from 3.4 percent last year to 2.9 percent in 2023. India has successfully implemented digitization to overcome the side effects of the pandemic and create opportunities for growth and jobs.
Fiscal policies changed the picture
The IMF chief said that ‘India’s fiscal policy has been responsive to economic conditions. We have seen the new budget presented and it shows the commitment towards fiscal consolidation, as well as it also makes various arrangements for fresh capital investment.
Responding to a question, Georgieva said that she is impressed by two things in the latest annual budget presented by Union Finance Minister Nirmala Sitharaman. The first is how focused India is on balancing the needs of development with fiscal responsibility. The second is a capital investment. It provides a long-term basis for development.
Emphasis on green economy
IMF chief believes that a green economy will change the condition and direction of India. He said, ‘I have seen how much India is paying attention to investing in the green economy, in this, it will help the country move towards clean energy. This also includes renewable energy with the potential to sustain growth. The medium-term fiscal framework continues to strengthen India’s public finances.
Digital ID is an important step
According to Georgieva, India has taken “a very bold step with the digital ID”. COVID acted as a trigger to push for digitization as it made it possible to work from home using digital platforms. After this many startups also opened. He said, “What is unique about India is that the public digital infrastructure is built in a very agile way. The private sector can benefit from this public infrastructure.
Responding to a question, he said ‘what the international community has learned from the shocks of the pandemic in Ukraine is that countries with strong fundamentals tend to withstand these shocks better. For India, this means the continuation of these strong fundamentals. India has made great progress in revenue collection. India has worked on its taxation system, it has stood firmly in favor of GST. This thing has made a lot of difference.
The memory of the local train journey
Sharing her personal experience, Jarjeeva said that she got a chance to ride in a local train compartment in Mumbai. Women tell me that the security they are provided makes a big difference. She goes to work, she goes to study. He said that the strength of the Indian economy is the young population. The youth should move towards leveraging the pool of talent for innovation.