According to the media house, On Tuesday IMF said in its latest report,“India is projected to clock an economic growth of 7.5 percent in the 2019-2020 fiscal year on the strengthening of investment and robust private consumption”.Growth is forecast to rise to 7.3 percent in fiscal year 2018/19 and 7.5 percent in 2019/20 on strengthening investment and robust private consumption, the report said.
The current account deficit is projected to widen further to 2.6 percent of the GDP on rising oil prices and strong demand for imports, offset by a slight increase in remittances, the report said. Headline inflation is projected to rise to 5.2 percent in fiscal year 2018/19, as demand conditions tighten, along with the recent depreciation of the rupee and higher oil prices, housing rent allowances and agricultural minimum support prices, it said.
It said that financial sector reforms have been undertaken to address the twin balance sheet problems, as well as to revive bank credit and enhance the efficiency of credit provision by accelerating the cleanup of the bank and corporate balance sheets. In the report, it was focused on the matter of “Systemic macro-financial risks persist, as the weak credit cycle could impair growth and the sovereign-bank nexus has created vulnerabilities. Domestic risks pertain to tax revenue shortfalls related to continued GST implementation issues and delays in addressing the twin balance sheet problems and other structural reforms”.
“Stability-oriented macroeconomic policies and progress on structural reforms continue to bear fruit” in the country, “A recent large fraud at a PSB highlights financial sector weaknesses and underscores the need for the government to take further steps to improve the PSBs’ governance and operations, including by considering more aggressive disinvestment”, the report said.