Urgent need for more ambitious structural, financial sector reform measures in India: IMF

“The environment is weaker than what we had forecast earlier,” IMF spokesperson Gerry Rice said

(FILES) This file photo taken on April 11, 2019, shows the seal of the International Monetary Fund at IMF Headquarters in Washington, DC. - Global trade tensions and continued uncertainty are sapping the strength of the world economy, which faces a "precarious" 2020, the International Monetary Fund warned on July 23, 2019. Trade conflicts are undercutting investment, and the IMF urged countries not to use tariffs in place of negotiations. In its quarterly update of its World Economic Outlook the IMF trimmed the global forecast issued in April by 0.1 this year and next, with growth expected to hit 3.2 percent in 2019 and 3.5 percent in 2020. (Photo by MANDEL NGAN / AFP)

India urgently needs more ambitious structural and financial sector reform measures and a medium-term fiscal consolidation strategy due to the rising debt levels while ensuring a more accommodative fiscal stance in the budget, the IMF has said.

Responding to a question on the budget presented by Union Finance Minister Nirmala Sitharaman, International Monetary Fund (IMF) spokesperson Gerry Rice said the economic environment in India is weaker than what the organisation had forecast earlier.

“While the budget touches on ongoing sectoral efforts, there remains an urgent need for more ambitious structural and financial sector reform measures and a medium-term fiscal consolidation strategy, anchored in tangible revenue and expenditure measures, especially given rising debt levels,” Mr. Rice said.

“The environment is weaker than what we had forecast earlier, that a more accommodative fiscal stance, this year, is appropriate, so that more accommodative fiscal stance in the budget, we think, is appropriate,” he said.

“But, over the medium term, to be looking at a fiscal consolidation strategy,” Mr. Rice said.

The IMF in January lowered India’s economic growth estimate for the current fiscal to 4.8%.