more-inIndia’s growth is projected to slow to 6.6 % in 2016-17 fiscal due to the strains that have emerged in the economy as a result of “temporary disruptions” caused by demonetisation, the IMF said on Wednesday. “Growth is projected to slow to 6.6% in FY2016/17, then rebound to 7.2% in FY2017/18, due to temporary disruptions, primarily to private consumption, caused by cash shortages,” it said. Tailwinds from a favourable monsoon, low oil prices and continued progress in resolving supply-side bottlenecks, as well as robust consumer confidence, will support near-term growth as cash shortages ease, the IMF said. In their report, the IMF Directors supported the Indian efforts to clamp down on illicit financial flows, but noted “the strains that have emerged” from the currency exchange initiative. The IMF said progress on important economic and structural reforms over the last year has been impressive.

Source: The Hindu February 22, 2017 15:13 UTC