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By Shloka Badkar | Ritu Singh Dec 23, 2022 10:22:04 PM IST (Updated)
The IMF has projected India's inflation for the present financial year at 6.9 percent. It will moderate only gradually over the next year to 5.1 percent, it said.
The International Monetary Fund (IMF) has projected India's GDP growth at 6.8 percent for the ongoing fiscal year, and has warned of debt sustainability risks. The IMF's executive board has concluded the 2022 Article IV consultation with India. The IMF conducts bilateral discussions with members almost every year under Article IV of its Articles of Agreement.
India's debt-to-GDP ratio peaked at 89 percent in FY21 and was at 83.4 percent in FY22. The IMF said India's debt is expected to remain around the mentioned level, before gradually declining from FY26 onwards.
The IMF said "despite mitigating factors, debt sustainability risks have increased due to higher effective interest rates combined with high gross financing needs and slowing growth." It added that the structure of India’s debt is a mitigating factor for sustainability risks.