Although it welcomed India’s growth rate forecast of 6.8% for FY22-23 and 6.1% for FY23-24, the International Monetary Fund (IMF) warned that policy space was limited given general global conditions. With downward revisions to growth forecasts from June and a slowdown expected next year, a 6.1% growth rate for the next fiscal year for India was ‘still a beacon of hope’ , said Anne-Marie Gulde-Wolf, deputy director of the Asia and Pacific department. at a Thursday night press conference at IMF headquarters here.

“But, it is absolutely true that you have to look at what else can be done,” she said in response to a question from The Hindu on what India could do to counter or mitigate the slowdown (to 6.1%) next fiscal year.

The IMF doesn’t see “much room” for fiscal support given the level of debt, so any new fiscal support should be “very targeted” and also time-bound, Ms Gulde-Wolf said, adding that monetary policy, too, must have a “tightening bias”.

“But it’s important to…whatever can be done on the structural front, not to create barriers to growth and to try to create an expectation of continued forward movement as well,” a- she declared.

Growth in Asia-Pacific expected at 4% in 2022

Growth for the Asia and Pacific region as a whole is expected to reach 4.0% and 4.3% in 2022 and 2023 respectively. This is well below the average growth of 5.5% over the previous two decades, but the region continues to perform better than the rest of the world, Krishna Srinivasan, who heads the Asia and Pacific department, told reporters on Thursday. IMF.

The IMF has recommended monetary tightening and fiscal consolidation for the region, Srinivasan said, with the exception of China and Japan, “where the recovery has been weaker, the slowdown remains significant, inflation n has not increased as strongly as elsewhere and there is room for political manoeuvre”.

Monetary tightening in the United States, which led to wide interest rate differentials, was the main factor behind the “fairly sharp” depreciation of Asian currencies, Srinivasan said.

At her opening press conference on Thursday, IMF Managing Director Kristalina Georgieva commented positively on India’s growth. “India deserves to be called a bright spot on this otherwise bleak horizon because it has been a fast growing economy even in these difficult times, but most importantly, this growth is being supported by structural reforms.” Ms Georgieva had also said that India is assuming the G20 presidency (for 2023) from “a position of strength”.