The IMF has projected a growth rate of 11.5 per cent for India in 2021, leaving behind China, Spain, France and Russia. This also makes India the the only major economy of the world to have a double-digit growth this year.
While China is poised for a 8.1 per cent growth, France and Russia are expected to grow at 5.5 and 3.0 per cent respectively. Spain is set to grow at 5.9 per cent making it the only second advanced economy to have a growth rate more than 5 per cent. The global economy is projected to grow 5.5 percent in 2021, as per the IMF report.
The latest projections by IMF makes India the fastest developing economy of the world.
In 2022, all countries are expected to register lesser growth rates with the global economy projected to at 4.2 percent in 2022. The IMF has predicted a growth rate of 6.8 per cent for India in 2022.
Although recent vaccine approvals have raised hopes of a turnaround in the pandemic later this year, renewed waves and new variants of the virus pose concerns for the outlook, says IMF.
The projected growth recovery this year follows a severe collapse in 2020 that has had acute adverse impacts on women, youth, the poor, the informally employed, and those who work in contact-intensive sectors. The global growth contraction for 2020 is estimated at -3.5 percent, 0.9 percentage point higher than projected in the previous forecast.
The IMF says the strength of the recovery is projected to vary significantly across countries, depending on access to medical interventions, effectiveness of policy support, exposure to cross-country spillovers, and structural characteristics entering the crisis.
On ways to reboot the economy, the IMF says that policy actions should ensure effective support until the recovery is firmly underway, with an emphasis on advancing key imperatives of raising potential output, ensuring participatory growth that benefits all, and accelerating the transition to lower carbon dependence.
Urging for cooperation between economies to grow, the IMF says strong multilateral cooperation is required to bring the pandemic under control everywhere. Such efforts include bolstering funding for the COVAX facility to accelerate access to vaccines for all countries, ensuring universal distribution of vaccines, and facilitating access to therapeutics at affordable prices for all.
The global community will need to continue working closely to ensure adequate access to international liquidity for these countries. Where sovereign debt is unsustainable, eligible countries should work with creditors to restructure their debt under the Common Framework agreed by the G20, says the IMF report
Aayush Pal 
Balaji Subramanian 
Palak Dogra