Home / Economy / India at relative ‘bright spot’ in world economy; must leverage exports: IMF

Having broadly recovered from the pandemic, India is a relative bright spot in the world economy today, growing at rates significantly above its peer average, IMF Deputy Managing Director Antoinette Sayeh has said on 6 January.

While speaking opening remarks at the Conference on South Asia's Path to Resilient Growth India, she said, India needs to leverage its existing strength in services exports and extend it to job-rich manufacturing exports. 

“India needs to leverage its existing strength in services exports and extend it to job-rich manufacturing exports by deepening its global value chain participation and complementary structural reforms that can boost productivity, formal employment, and exports," IMF director said.

"Macroeconomic policies are responding to the significant headwinds, with fiscal policy measures supporting vulnerable groups and monetary policy addressing persistently high inflation," she said.

At the conference, RBI Governor Shaktikanta Das said taming inflation is the top priority for South Asian countries as risks to growth and investment outlook could rise if price pressures persist at high levels.

As per the estimates of the IMF, the governor said the South Asian region contributed 15 per cent to global growth, led by India and Bangladesh.

Apart from inflation, RBI's Das said reducing external debt vulnerabilities, moving focus to high productive sectors, strengthening energy security, cooperation on greener economy and increasing tourism were key areas of focus for the region.

India's headline inflation moderated to an 11-month low 5.88 percent in November from 6.77 percent the month before. The Reserve Bank of India's monetary policy committee has increased the policy repo rate by 225 basis points since May last year to reign in inflation.

Sayeh said she was hopeful that India's federal government will provide a clear path on fiscal consolidation in the upcoming budget for 2023-24.

(With inputs from Reuters)

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