India’s promising economy is obviously one of those that investors are attracted to. According to the director of the International Monetary Fund, India will soon outpace China as the fastest growing economy in the world. Christine Lagarde further pressed on that this could happen within the year.
The director visited India last week and reported that India’s economy is expected to steadily grow at 7.5 percent in the fiscal year 2015-2016 which will begin in April. This figure is up by .3 percent from the current year.
If India hits the expected growth, this will make the country the fastest growing economy in the world surpassing China.
The International Monetary Fund predicted last year that the economy of India would grow by 6.5 percent in 2016. The estimate was raised after a promising Indian gross domestic product. On another note, despite the fast growth in India’s economy, the country’s raw economic power does not come close to that of China’s. The economic output of China last year was reported to be at around $10 trillion while India had roughly $2 trillion. This was according to the data gathered by IMF.
Despite this, Largarde still described India as the “bright spot” when it comes to global economic growth. The conditions in India are perfect to reap the benefits of demographic dividend making it a key factor for global growth.
India’s policy reforms
India’s economic improvement can be attributed to the reforms in policies and improved confidence in the business sector. These provided a boost for the growth of the economy. The current government led by Prime Minister Narendra Modi made India’s economic growth at the top priority for India.
The latest budget reforms revealed the new government’s plan to decrease taxes among business establishments and increase spending on building infrastructures.
The director of IMF said that looking into the future, the economy of India would have doubled its size in 2009. The output of India is also predicted to exceed the outputs of Russia, Indonesia and Brazil put together.
India should be thankful to its young and growing population. The total population of India is estimated to be around 1.25 billion and more than half of the number is of the age 25 and below.