India is on growth track, says IMF

Measures taken by the new government start showing signals of growth

December 11, 2014 11:55 pm | Updated November 16, 2021 07:14 pm IST - BENGALURU:

The International Monetary Fund on Thursday said the focus on governance and financial inclusion measures taken by the government were positive signs that India was back on the growth track.

In India, the growth was stalled for sometime, but the measures taken by the new government started showing signals of growth, it said.

“We see a positive outlook for India. Last year, the growth rate was 4.7 per cent, and in the current year it would be around 5.6 per cent. With the new government’s initiatives, we believe the growth rate next year would be even more,” said Ratna Sahay, Deputy Director (Strategy, Planning and Coordination), Monetary and Capital Markets Department, IMF.

The IMF also said, in India lack of infrastructure was a major hurdle for developmental activities, which the government needed to address for speedy growth.

Commenting on the ‘Make in India’ move by the government, Ms. Ratna said, “It will create jobs, and will generate tax revenues. This will help in reducing the fiscal deficit.’’ The IMF also said the growth outlook was good. However, the country needed more reforms to fuel the growth.

“Though there are positive signs, there are lot of reforms needed to bring inflation and budget deficit down,” she added. Some of the reforms the government should look at would be to improve tax administration, introduction of GST, to get rid of subsidies on fertilizers as well as food and reduce corruption.

“Getting rid of subsidies does not mean ignore the poor. It should be targeted. When the entire country gets bank accounts, it can be facilitated by direct cash transfer. The current account deficit has improved from last year and it will also improve,” added Ms. Ratna.

Top News Today

Sign in to unlock member-only benefits!
  • Access 10 free stories every month
  • Save stories to read later
  • Access to comment on every story
  • Sign-up/manage your newsletter subscriptions with a single click
  • Get notified by email for early access to discounts & offers on our products
Sign in

Comments

Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.

We have migrated to a new commenting platform. If you are already a registered user of The Hindu and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.