However, the IMF noted that India may grow at an impressive 8.8% rate in 2021, surpassing China’s projected rate of 8.2%, thus regaining its position as the fastest growing emerging economy.
In its latest report “World Economic Outlook”, the IMF noted that revisions to the growth forecast are particularly important for India, where gross domestic product (GDP) contracted much more severely than expected in the second quarter (Q2 ). India’s growth rate was 4.2% in 2019.
“As a result, the economy is projected to contract 10.3% in 2020, before recovering 8.8% in 2021,” the IMF said.
Among the major economies, China is the only country showing a positive growth rate of 1.9% in 2020. While the United States is forecast to contract 4.3% in the current fiscal year and grow by 3, 1% in 2021.
Predicting a deep global recession this year, the IMF said global growth will collapse by 4.4 percent, stating that the global economic crisis is far from over due primarily to the impact of the coronavirus pandemic.
“However, this crisis is far from over. In our latest World Economic Outlook, we continue to project a deep recession in 2020. Global growth is projected to be -4.4%, an upward revision of 0.8 percentage points compared to our June update. ” Gita Gopinathsaid the IMF’s chief economist.
Gopinath said that with the exception of China, where production is expected to exceed 2019 levels this year, production in both advanced economies and emerging and developing markets is expected to remain below 2019 levels. even next year.
The IMF has improved its forecast for advanced economies for 2020 to -5.8%, followed by a rebound in growth to 3.9% in 2021.
According to the report, India is among those likely to suffer the most damage from global warming, reflecting its initially high temperatures. For India, the net gains from climate change mitigation, relative to inaction, would amount to 60-80 percent of GDP by 2100.
The IMF noted that the economic union of the five largest countries (the United States, China, the European Union, Japan and India), acting together, can make a big dent in global emissions. While the economic costs of mitigation vary from country to country, all will benefit greatly from the damages avoided by climate change and the co-benefits of mitigation, such as reduced pollution and mortality.
Gopinath said that over time, as the recovery strengthens, policies should change to facilitate the reallocation of workers from sectors that are likely to contract in the long term (travel) to growing sectors (e-commerce).
Emerging market and developing economies have to handle this crisis with fewer resources, as many are constrained by high debt and higher borrowing costs, he added.
(With contributions from the agency)
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