India, China to contribute half of world growth: IMF

Chennai: China and India are projected to jointly contribute about half of world growth in both 2023 and 2024, said the International Monetary Fund.

China and India are projected to jointly contribute about half of world growth in both 2023 and 2024. India’s share in this is 16 per cent and the remaining is contributed by China. However, India’s contribution to global economic growth is expected to increase 200 basis points (bps) to 18 per cent over the next five years as the country grows at a quicker pace, said Krishna Srinivasan, director of Asia Pacific Department, IMF.

“India's economic growth remains robust, driven by large public capital expenditure push and resilient domestic demand. The economy is expected to grow by 6.3 per cent in 2023 and in 2024,” he said. Meanwhile, the Chinese economy is expected to expand 5 per cent in 2023 and 4.2 per cent in 2024, lower than estimated in April.

“The overall macroeconomic environment in India is pretty sound. They have been fiscally disciplined. They expect the fiscal at 5.9 per cent this year. The central bank has moved fast to bring inflation under control. The most recent number was 5 per cent. So, inflation is coming down,” he said earlier.

India has made significant strides in the area of digitalization and beefing up infrastructure. But beyond that, there could be reforms aimed at improving the business environment, labour reforms, removing trade restrictions. All these go into building an environment which will support investor competence more -- more so in India. So, structural reforms will be the key in supporting, he added.