Organization for Economic Co-operation and Development (OECD) interim economic outlook has pegged India’s gross domestic product (GDP) growth to rebound to 12.6% in FY22, which will be the fastest in the world, followed by China at 7.8% growth.
India’s GDP is expected to grow at 5.4% in the following financial year, owing to faster rebound of several large emerging-market economies, the global body said in its interim economic outlook.
The OECD estimates support what the International Monetary Fund ( IMF) forecast in January 2021. According to the global banking institution, India will be the only major economy to exhibit double digit growth in the coming fiscal year, which kicks off in April.
If India grows at that level, it will make the country the fastest growing economy in the world, stealing the title back from China, which the OECD expects to grow at 7.8 per cent in FY22.
“The recovery in activity continued in the fourth (December) quarter of 2020, despite new virus outbreaks in many economies and tighter containment measures. Global output remained around 1% lower than prior to the pandemic, with marked variation in the pace of recovery across economies. The rebound has been relatively fast in several large emerging-market economies. Activity moved above pre-pandemic levels in China, India and Turkey, helped by strong fiscal and quasi-fiscal measures and a recovery in manufacturing and construction,” the OECD said in its interim economic outlook.
India and China are followed by the United States (6.5%), Turkey (5.9%), France (5.9%), Spain (5.7%), UK (5.1%), Indonesia (4.9%), Canada (4.7%), Mexico (4.5%), Italy (4.1%), Eurozone (3.9%) and Brazil (3.7%).
For the world economy, the OECD raised its expectation to 5.6% for 2021 and 4% next year. This is better from a December forecast of 4.3% growth in 2021 and 3.7% for 2022. The improvement is due to successful coronavirus vaccines and announcements of additional fiscal support in some nations.
