The International Monetary Fund cut India's gross domestic product (GDP) growth to 9.5% for 2021-22, from its earlier estimate of 12.5%, citing the impact of the second wave on the economy and recovery process. In its latest update, the IMF said growth prospects in India have been downgraded following severe second wave of Covid.
The global economy is projected to grow 6.0 percent in 2021.For 2022, growth forecast was raised to 4.9 percent from 4.4 percent, the IMF said in an update to its World Economic Forecast. The 2021 global forecast is unchanged from the April 2021 WEO, but with offsetting revisions. Prospects for emerging market and developing economies have been marked down for 2021, especially for Emerging Asia. By contrast, the forecast for advanced economies is revised up. These revisions reflect pandemic developments and changes in policy support. The 0.5 percentage-point upgrade for 2022 derives largely from the forecast upgrade for advanced economies, particularly the United States, reflecting the anticipated legislation of additional fiscal support in the second half of 2021 and improved health metrics more broadly across the group.
Economic prospects have diverged further across countries since the April 2021 World Economic Outlook (WEO) forecast. Vaccine access has emerged as the principal fault line along which the global recovery splits into two blocs: those that can look forward to further normalization of activity later this year (almost all advanced economies) and those that will still face resurgent infections and rising COVID death tolls. The recovery, however, is not assured even in countries where infections are currently very low so long as the virus circulates elsewhere.
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