India has emerged as the fastest-growing economy, surpassing China, which is not surprising given the size of both nations’ economies, according to Krishna Srinivasan, the Director of the IMF’s Asia and Pacific (APAC) Department. In a conversation with ANI, Srinivasan explained that China is more than four times larger than India, so if India is growing faster than China, it should not come as a surprise.
Krishna Srinivasan from the International Monetary Fund (IMF) praised India’s economic performance, particularly its projected growth rate of 6.8% for the fiscal year 2024-25, calling it “very impressive.” These comments were made during a discussion on India’s economic outlook with ANI on April 20.
Srinivasan commended India’s ability to navigate multiple shocks, such as the COVID-19 pandemic, the Russia-Ukraine war, and tensions in the Gulf region, highlighting the country’s resilience. He emphasized India’s successful management of these shocks in the recent past, as quoted by ANI.
The IMF Director credited India’s impressive growth to strong private consumption and public investment, noting that he does not see any red flags in the near term. However, he emphasized the need for significant reforms, especially in education and healthcare, to fully leverage the potential of India’s expanding labor force.
India’s young and growing population is expected to add about 15 million people to the labor force each year, according to Srinivasan. He highlighted the importance of substantial investments in education and healthcare to ensure that this demographic advantage contributes effectively to the economy.
Srinivasan expressed optimism about India’s medium-term prospects with a growth rate of around 6.5%, but stressed the importance of implementing comprehensive reforms. He stated that with diligent implementation of reforms, India could achieve a growth rate of 6.5% or higher over the next several years, as quoted by ANI.