IMF Blames NBFCs, Corporate Uncertainty for India’s Weak Growth

IMF Spokesperson Gerry Rice.

(Photo: Video Screengrab)

Amid reports of shutdowns and layoffs in multiple sectors, International Monetary Fund spokesperson Gerry Rice on Friday, 13 September, said India’s economic growth is “much weaker than expected.”

“Latest GDP figures reflect slow growth rate for India. What’s IMF’s assessment? We’ll have fresh numbers coming up but recent economic growth in India is much weaker than expected, mainly due to corporate and environmental regulatory uncertainty and lingering weakness in some non-bank financial companies and risks to the outlook are tilted to the downside, as we like to say.”

Gerry Rice, IMF Spokesperson

In July, IMF had cut its annual growth forecast for India, as it expected weaker domestic demand to limit an economic recovery.

India's economic growth slumped to a near seven-year low of 5 percent in the April-June quarter of 2019-20 due to a sharp deceleration in the manufacturing sector and sluggish agriculture output, according to official data released on Friday, 30 August.

According to another government data, growth of eight core industries dropped to 2.1 percent in July mainly due to a contraction in coal, crude oil, natural gas and refinery products.