Washington: The International Monetary Fund (IMF) has projected the growth of Indian economy in 2020 at the rate of 1.9 per cent, while the world economy is likely to contract sharply by “minus 3 per cent” due to the coronavirus pandemic, which is proving worse than the 2008-09 financial crisis.
The IMF on Tuesday its yearly World Economic Outlook, providing a grim picture of the world economy amid global lockdown due to the coronavirus pandemic, which has jolted the world by claiming over one lakh lives globally.
The IMF has, however, given a bullish projection about India’s economic growth in 2021, pegging the growth rate at 7.4 per cent.
Gita Gopinath, Chief Economist and Director of the research department at IMF said in her opening remarks, “The COVID-19 pandemic is inflicting high and rising human costs worldwide. Protecting lives and allowing health care systems to cope have required isolation, lockdowns, and widespread closures to slow the spread of the virus.”
“The health crisis is, therefore, having a severe impact on economic activity. As a result of the pandemic, the global economy is projected to contract sharply by minus 3 per cent in 2020, much worse than during the 2008-09 financial crisis,” said Gopinath.
According to her, India will experience a growth of marginal 1.9 per cent. India in 2019 recorded a growth of 4.2 per cent. The outlook gives a more positive outlook for India’s economy in 2021 with a projected growth of 7.4 per cent.
Gopinath said: “Advanced economies with strong governance capacity, well-equipped health care systems, and the privilege of issuing reserve currencies are relatively better placed to weather this crisis. But several emerging market and developing economies without similar assets and confronting simultaneous health, economic, and financial crises will need help from advanced economy bilateral creditors and international financial institutions.”