IMF, Auto News, ET Auto
India’s economy, which contracted 7.3% due to the COVID-19 pandemic, is expected to grow 9.5% in 2021 and 8.5% in 2022, according to the latest projections released on Tuesday by the International Monetary Fund.
India’s growth projection released by the latest World Economic Outlook remains unchanged from its previous update of this summer’s July WEO (World Economic Outlook), but is three points lower. percentage in 2021 and 1.6 percentage points down from its April projections.
According to the latest WEO update, released ahead of the IMF-World Bank annual meeting, global growth is expected to reach 5.9% in 2021 and 4.9% in 2022.
The United States is expected to grow 6% this year and 5.2% next year.
China, for its part, according to the IMF, is expected to grow 8% in 2021 and 5.6% in 2022.
IMF chief economist Gita Gopinath said that compared to their July forecast, the global growth projection for 2021 has been revised down slightly to 5.9% and is unchanged for 2022 to 4.9%. However, this modest overall revision masks severe deterioration for certain countries.
“The outlook for the group of low-income developing countries has darkened considerably due to worsening pandemic dynamics. The deterioration also reflects a more difficult near-term outlook for the group of advanced economies, in part due to supply disruptions, ”she said.
Partly offsetting these changes, the projections of some commodity exporters have been revised upwards due to rising commodity prices. Labor market recovery has lagged considerably behind the resumption of production in most countries, “said the Indian. -Added an American economist.
Noting that the dangerous divergence in economic prospects between countries remains a major concern, she said the aggregate output of the advanced economies group is expected to return to its pre-pandemic trend path in 2022 and exceed it by 0.9% in 2024.
“In contrast, the aggregate output of the group of emerging markets and developing economies (excluding China) is expected to remain 5.5% lower than pre-pandemic forecast in 2024, resulting in a larger decline of improving their standard of living, ”she added.
Noting that one of the main factors common to these complex challenges is the pandemic’s continued grip on global society, Gopinath said the top policy priority is therefore to immunize at least 40 percent of the population in each country. ‘by the end of 2021 and 70 percent by mid-2022.
“This will require high-income countries to fulfill existing vaccine dose donation pledges, coordinate with manufacturers to prioritize shipments to COVAX in the short term, and remove trade restrictions on the flow of vaccines and their inputs,” he said. she declared.
At the same time, closing the remaining US $ 20 billion funding gap for genomic testing, therapy and monitoring will save lives now and keep vaccines fit for purpose. Going forward, vaccine manufacturers and high-income countries should support the expansion of regional production of COVID-19 vaccines in developing countries through finance and technology transfers, she said.
Gopinath said another urgent global priority is the need to slow the rise in global temperatures and contain the growing adverse effects of climate change. This will require more ambitious commitments to reduce greenhouse gas emissions at the upcoming United Nations Climate Change Conference (COP26) in Glasgow.
“A policy strategy that includes an international carbon price floor adjusted to country circumstances, a push for green public investments and research subsidies, and targeted compensatory transfers to households can help advance the energy transition in an equitable manner. deliver on their previous pledges to mobilize $ 100 billion in annual climate finance for developing countries, ”said Gopinath.