The International Monetary Fund expects India to increase its contribution to global growth over the next five years as the economy continues to grow fairly rapidly.
India will likely account for 18% of world growth by 2028, up from 16% currently, Krishna Srinivasan, director of the Asia and Pacific Department of IMF, told reporters in Mumbai on Thursday.
India’s faster growth compared with China’s economic slowdown could see the South Asian nation make a bigger contribution to global growth than its larger rival — only temporarily — the latest IMF figures show.
However, in terms of the size of their economies, China remains dominant. Based on the latest estimates from the IMF, China’s nominal gross domestic product will increase to $23.61 trillion by 2028, while India’s will reach $5.94 trillion.
China and India will jointly contribute about half of world growth in both 2023 and 2024, IMF figures show.
HSBC economists Frederic Neumann and Justin Feng said in a report last week that India is far from matching China’s contribution to the world economy, based on the size of the two economies and their share of global investment and consumption.
The IMF estimates India’s economy will expand 6.3% in both this year and next. It expects Asia Pacific to remain the “most dynamic region” this year, with growth of 4.6%, although the expansion is expected to slow to 4.2% in 2024 and to 3.9% in the medium term — “the lowest in the past two decades except for 2020,” it said.
