India is a source of growth for the global economy for the next few decades and it could be what China was for the world economy, the IMF said, as it suggested the Country to take steps towards more structural reforms.
“India now contributes, in purchasing power parity measures, 15 per cent of the growth in the global economy, which is substantial,” Ranil Salgado, International Monetary Fund’s mission Chief for India said. This is next to only China and the US, he said.
Salgado said spillovers from India are not that big because it is not a very open economy. “But of total global growth in Purchasing power parity (PPP) terms, it’s 15 per cent of total global growth. Trading is not as high as China trade levels,” Salgado said as the IMF Executive Board released the report of its annual consultations with India. He said the IMF views India as a “long run source of global growth”.
“India has three decades before it hits the point where the working age population starts to decline. So that’s a long time. This is India’s window of opportunity in Asia. It’s somewhat only a few other Asian countries have this,” he said.
“For the (next) three decades, it (India) is a source of growth for the global economy and could be even longer. But three decades where India can be almost what China was for the world economy for a while,” Salgado said. In its report, the IMF Executive Board has forecast India’s growth to rise to 7.3 per cent in FY2018/19 and 7.5 per cent in FY2019/20, on strengthening investment and robust private consumption.