UN report gives thumbs up to India, says it is performing relatively well compared to other countries

Cautious macroeconomic policy, reduced inflation and some structural reforms have helped India perform relatively well at times of global economic slowdown.

PTI April 29, 2016 13:10:01 IST
UN report gives thumbs up to India, says it is performing relatively well compared to other countries

United Nations: With India projected to grow at 7.8 percent in 2017-18, a UN expert said cautious macro economic policy, reduced inflation and some structural reforms have helped the country perform relatively well in an environment of global economic slowdown.

The United Nations Economic and Social Survey for Asia and the Pacific-2016 report, released on Thursday, said that the Indian economy is projected to expand by 7.6 per cent in 2016-17 and grow further to 7.8 per cent in 2017-18, mainly on
the back of domestic consumption demand aided by steady employment and a relatively low inflation.

UN report gives thumbs up to India says it is performing relatively well compared to other countries

Representational image. Reuters

Economic Affairs Officer in the UN Department of Economic and Social Affairs, Sebastian Vergara told reporters at the launch of the report at the United Nations office that several demographic and structural factors are responsible for India performing in a "relatively very good way" as compared to economic growth in other countries.

"The macro-economic policy in recent years has been cautious, especially in the fiscal side. This has been a positive development to provide a good framework to increase the sentiment of consumers," Vergara said.

He added that monetary policy has also played an "important role" in reducing inflation in recent years. "That is also playing a positive role for the Indian economy."

He however noted that the picture is "mixed" with respect to structural reforms being undertaken in the country.

"In some areas, the Indian government has made important efforts and those efforts are starting to pay off in terms of increase in investment but there are some areas where structural reforms are having some slow progress," he said.

The report projects inflation for India at 5.2 percent for the 2016-17 fiscal and 5.6 percent for the 2017-18 year.

The report said that in South and South-West Asia, India’s economy is gradually gaining growth momentum "amid making steady, albeit uneven, progress" on policy reforms to attract foreign investment and revive stalled infrastructure projects.

"The positive spillovers of stronger growth in India into other major economies in the sub-region are, however, small in view of the limited trade and financial interlinkages. Despite a recent increase, the sub-region's economic growth rate remains below its potential," it said.

For India, "the near-term growth outlook is positive", with the projected growth being 7.6 percent in 2016 and 7.8 percent in 2017, it said.

It said that the economic outlook for developing Asia-Pacific economies is broadly stable but is "clouded by uncertainty".

Economic growth in 2016 and 2017 is forecast to increase marginally to 4.8 percent and 5 percent, respectively, from an estimated 4.6 percent in 2015, as a consequence of macroeconomic risks continues to buffet the region.

"These risks include: a somewhat uncertain outlook for the Chinese economy in the backdrop of a fragile global economic recovery; weak consumption and investment trends in major developing economies in the region; volatility in exchange rates, including that due to low oil prices for commodity exporters; growing private household and corporate debt; and an ambiguous path of interest rate increases being pursued by the United States. These uncertainties are interconnected and thus complicated to manage,” it said.

The report projected that inflation is expected to remain low in the region as a whole, reaching a multi-decade low of 3.7 percent in 2016 compared with 4.1 percent in 2015.

Updated Date:

also read

Several UN World Heritage sites in danger of losing status because of damage, development or tourism
science

Several UN World Heritage sites in danger of losing status because of damage, development or tourism

The UN's Educational, Scientific and Cultural Organization recommended Monday a major revamp of the heritage list.

International Day for elimination of sexual violence in conflict zones: Theme, history and significance
India

International Day for elimination of sexual violence in conflict zones: Theme, history and significance

In 2015, the UN conceived of this initiative in a bid to condemn the gender-based violent acts and strengthen its commitment to end all forms of violence against women

World Day Against Child Labour 2021: Theme this year is 'Act Now, End Child Labour'
World

World Day Against Child Labour 2021: Theme this year is 'Act Now, End Child Labour'

This special day was first observed in 2002 by the International Labour Organisation (ILO), a United Nations agency