India largest growing economy: International Monetary Fund (IMF) lists three focus areas for growth reforms

India is set to maintain its position as the fastest-growing economy globally, with the International Monetary Fund (IMF) projecting a growth rate of 7% for the financial year 2024-25. Director of the IMF Asia Pacific Department, Mr. Krishna Srinivasan, stated that India’s growth trajectory will be underpinned by strong macroeconomic fundamentals, a rebound in rural consumption, and a decline in inflation, which is anticipated to reach 4.4% during this period. Despite the upcoming elections, he emphasised that fiscal consolidation remains on track, supported by a robust reserve position.

To further enhance its growth outlook, he identified three critical areas for reform: job creation, trade barriers, and infrastructure development. He underscored the importance of implementing the labour codes approved in 2019-2020 to foster flexible labour markets while ensuring social protection for workers. Additionally, he suggested that India should consider reducing existing trade restrictions to boost competitiveness and job creation. Furthermore, continued reform in infrastructure is essential, focusing on physical and digital advancements, as well as agriculture and land reforms. Strengthening education and skills development, improving the business environment, increasing labour force participation among women, and addressing youth unemployment are other significant concerns that need attention.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.