Amid the ongoing Ukraine crisis, the International Monetary Fund (IMF) on Tuesday slashed its projection of India's economic growth in 2022 to 6.1 per cent. However, its growth is estimated to be the fastest among major economies.
Behind India, were China (4.4 per cent), Saudi Arabia (3.7 per cent), and Nigeria (3 per cent).
In its annual World Economic Outlook report, the IMF said that the United States (US) is likely to grow at 1 per cent while Russia, Italy, and Germany were forecast to suffer a decline in economic growth, the IMF said.
"The global economy continues to face steep challenges, shaped by the lingering effects of three powerful forces: the Russian invasion of Ukraine, a cost-of-living crisis caused by persistent and broadening inflation pressures, and the slowdown in China," it said.
Recently, many agencies have cut India's gross domestic product (GDP) growth forecast amid higher inflation and rising policy interest rates.
On 06 October, the World Bank curtailed its growth forecast for India for 2022-23 to 6.5 per cent year-on-year from a previous estimate of 7.5 per cent.
Ealier, American credit rating agency, S&P Global Ratings on Monday estimated India's economic growth at 7.3 per cent in the current fiscal with downside risks.
In its economic outlook for the Asia Pacific, the agency said that we have retained our growth outlook for India at 7.3 per cent for the fiscal year 2022-2023 and 6.5 per cent for the next fiscal year.
It also mentioned that inflation is likely to remain above the Reserve Bank of India's (RBI's) upper tolerance threshold of 6 per cent till December 2022.
Indian economic growth in 2023 will get support from domestic demand recovery after the Covid-19 pandemic, the report said.
Also, the Asian Development Bank (ADB) downgraded India's economic growth projection for 2022-23 to 7 per cent from 7.2 per cent.
According to the bank, the step came due to the higher-than-expected inflation in India and monetary tightening by the Reserve Bank of India.
The ADB said in a report that the Indian economy grew 13.5 per cent year-on-year (YoY) in the first quarter of 2022-23, Witnessing strong growth in services.
Meanwhile, Fitch also slashed India’s GDP growth forecast to 7 per cent in the financial year 2023 compared with 7.8 per cent in its earlier projection. The move came on the back of a global slowdown and tighter monetary policy.