Economic Progress

India's economy is set to grow faster than China's this year 

The IMF has said India should grow at 7.3% in 2018-2019, up from 6.7% last year.

Rimin Dutt
Our Impact
What's the World Economic Forum doing to accelerate action on Economic Progress?
The Big Picture
Explore and monitor how Economic Progress is affecting economies, industries and global issues
A hand holding a looking glass by a lake
Crowdsource Innovation
Get involved with our crowdsourced digital platform to deliver impact at scale
Stay up to date:

Economic Progress

The International Monetary Fund (IMF) has said India should grow at 7.3% in 2018-2019, up from 6.7% last year but lower than its earlier projection earlier this year.

In April, IMF had projected India’s growth rate to be at 7.4%, which it has now revised down given the recent increase in global oil prices and tightening global financial conditions, IMF has said in its World Economic Outlook report.

For 2019-20, India’s growth is projected to be at about 7.4%, on the back of the rebound from the shocks of demonetisation and the goods and services tax (GST), and improving private consumption and investment climate.

In comparison, China is expected to grow at 6.6% in 2018 and 6.2% in 2019. China’s growth projections have been lowered in part due to the impact of US tariffs hitting Chinese exports and slowing external demand growth and financial regulatory tightening, according to the report. China was the fastest growing economy in the world in 2017.

According to India’s central bank the Reserve Bank of India, in 2018-19, India’s GDP is expected to grow at 7.4%, a figure the Indian government said it would exceed. IMF has said that India’s medium-term growth prospects are strong at 7.75% attributable to structural reforms.

Image: IMF

Inflation warning

However, the recent hike in oil prices and weakening rupee is expected to affect India’s inflation numbers, according to IMF, which has called for a tighter monetary policy.

IMF has warned that India’s inflation rate is expected to increase to 4.7% in 2018-19 compared to 4.5% in 2016-17 because of rising fuel prices and accelerating demand.

Have you read?

Comparing India to trends in Argentina, IMF has urged India to “re-anchor expectations” where inflation continues to be high and increasing higher due to a sharp currency depreciation.

Last week, RBI’s monetary policy committee (MPC) kept interest rates unchanged at 6.5% partly on expectation that inflation was manageable, preferring instead a “calibrated tightening of monetary policy.”

Don't miss any update on this topic

Create a free account and access your personalized content collection with our latest publications and analyses.

Sign up for free

License and Republishing

World Economic Forum articles may be republished in accordance with the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Public License, and in accordance with our Terms of Use.

The views expressed in this article are those of the author alone and not the World Economic Forum.

Related topics:
Economic ProgressIndiaGeo-economicsChina
World Economic Forum logo
Global Agenda

The Agenda Weekly

A weekly update of the most important issues driving the global agenda

Subscribe today

You can unsubscribe at any time using the link in our emails. For more details, review our privacy policy.

IMF says global economy 'remains remarkably resilient', and other economics news

Joe Myers

April 19, 2024

About Us



Partners & Members

  • Join Us

Language Editions

Privacy Policy & Terms of Service

© 2024 World Economic Forum