India Emerges as Fastest-Growing Economy in 2024: IMF Forecast

India has emerged as a standout performer among major economies, with the International Monetary Fund (IMF) projecting it to maintain its status as the fastest-growing economy in 2024. The IMF’s latest World Economic Outlook has revised India’s growth projections upward to 6.8 per cent for the year, citing robust domestic demand and a burgeoning working-age population as key drivers.

The Deputy Managing Director of the IMF, Okamura, highlighted Asia’s role as the driving force behind global economic expansion, with the region expected to contribute 60 percent of global growth in 2024. Despite facing challenges such as inflation management, most Asian countries are expected to meet central bank targets by the end of the year.

India’s economic performance has been impressive, with official data showing a growth rate of 8.4 percent during the October-December quarter of the financial year 2023-24. This growth trend has been consistent, with India’s economy growing at rates of 7.8 percent and 7.6 percent in the preceding two quarters, and achieving growth rates of 7.2 percent and 8.7 percent in the fiscal years 2022-23 and 2021-22, respectively.

The global economic outlook remains positive, with the IMF projecting global growth to reach 3.2 percent in both 2024 and 2025. Despite challenges such as high debt levels and escalating debt servicing costs, the global economy has shown resilience in the face of successive shocks.

As countries worldwide grapple with the aftermath of the pandemic and other conflicts, Okamura emphasized the importance of mobilizing domestic revenues to sustain growing spending demands and enhance resilience against future shocks. Emerging markets and developing economies have the potential to boost their tax-to-GDP ratios, thus enhancing their fiscal capacity.

India’s strong economic performance and growth projections underscore its significance in driving global economic dynamics. With a demographic dividend and robust domestic demand, India is poised to continue its growth trajectory and contribute significantly to global economic expansion in 2024.