Lok Sabha Question No. 2289 (UNSTARRED), answered on 2015-12-11
Subject: Global Slowdown and Indian Economy
Ministry: FINANCE
Asked by: SRIRAM MALYADRI, KURUPPASSERY VARKEY THOMAS, SAKUNTALA LAGURI, CHANDRAKANT BHAURAO KHAIRE

- (a) the ratings given to India by the International Monetary Fund (IMF) Report in terms of economic growth;
- (b) whether IMF has warned of a global slowdown of economic growth and if so, the details thereof;
- (c) whether the Government has taken adequate policy measures to check the impact  of  global  slowdown  on  Indian  economy  and  maintain  higher  growth rate;
- (d) if so, the details thereof and the steps taken by the Government in this regard; and
- (e) the extent to which the Government has succeeded in this regard?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI JAYANT SINHA)

(a):  The  International  Monetary  Fund  (IMF)  does  not  give  numerical  ratings  for countries in terms of economic growth. As per the World Economic Outlook (WEO) released  by  the  IMF  in  October,  2015,  the  GDP  growth  rate  for  India  has  been projected  to  increase  from  7.3  percent  in  2014-15  and  2015-16  to  7.5  percent  in 2016-17.

(b): IMF projects global growth to decline from 3.4 per cent in 2014 to 3.1 per cent in 2015 and then to pick up in 2016 to an annual rate of 3.6 per cent. It expects this growth to be driven by a rebound in advanced economies, supported by the decline in oil prices, with the US playing the most important role. In advanced economies, growth is projected to rise from 1.8 per cent in 2014 to 2.0 per cent in 2015 and 2.2 per  cent  in  2016  (lower  than  the  July  estimate  by  0.1  per  cent  0.2  per  cent, respectively). Emerging Market Economies (EMEs) GDP growth is expected to slow down to 4 per cent in 2015 from 4.6 per cent in 2014 before rising again to 4.5 per cent in 2016.

(c)  &  (d):  The  Government  of  India  has  taken  various  initiatives  to  accelerate  the growth  of  the  economy  which,  inter  alia,  include;  fillip  to  manufacturing  and infrastructure  through  higher  public  investment  and  fiscal  incentives;  reforms  and liberalization of foreign direct investment in selected sectors; Skill India and Digital India initiatives; measures to de-bottleneck the supply of key raw-materials like coal; 'Make in India'  initiative  along  with  the  attendant  facilitatory  measures  for  a  more conducive  environment  for  investment;  financial  inclusion  though  'Pradhan  Mantri Jan  DhanYojana'  which  also  helps  to  strengthen  banking  and  insurance  services; introduction  of  'Gold  Monetization  Schemes'  to  mobilize  the  gold  held  by  the household and institutions in the country for productive use and reduce the country's reliance  on  the  import  of  the  gold  to  meet  domestic  demand;  launching  of  Micro Units  Development  and  Refinance  Agency  Ltd.  (MUDRA);    boost  to  agricultural sector with focus on micro irrigation, watershed development, soil conservation and credit, along with various measures to improve clarity and transparency in economic policy-making. Fiscal reforms with emphasis on consolidation, expenditure reforms and rationalization of tax structure, could also contribute to higher growth.

(e):  As  per  the  revised  estimates  released  by  Central  Statistics  Office  (CSO),  the growth rate of GDP at constant market (base: 2011-12) prices is estimated at 7.3 per cent in 2014-15 and 7.2 per cent in the first half of 2015-16.

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