The 2018 Global Economics Prospect (GEP) released by the World Bank has projected India’s growth rate to 7.3% in 2018 and 7.5 for the next two years i.e. 2019 and 2020.
According to report, India, despite initial setbacks from demonetisation and Goods and Services Tax (GST), is estimated to have grown at 6.7% in 2017, higher than 6.5% estimated by Government.
Key Highlights of 2018 GEP
India has enormous growth potential compared to other emerging economies with implementation of comprehensive reforms. In all likelihood, India is going to register higher growth rate than other major emerging market economies in next decade.
China grew at 6.8% in 2017, 0.1% more than that of India, while in 2018, its growth rate is projected at 6.4%. In next two years, China’s growth rate will drop marginally to 6.3 and 6.2%, respectively. In comparison with China, which is slowing, India growth will gradually accelerate.
To materialise its potential, India needed to take steps to boost investment prospects. On productivity side, India has enormous potential with respect to secondary education completion rate. India is also undertaking measures in terms of non- performing loans and productivity.
India’s prospects will further improve with improved labour market reforms, education and health reforms as well as relaxing investment bottleneck. India has favourable demographic profile which is rarely seen in other economies. In this, improving female labour force participation rate is going to be important.
Global Economic Prospects
GEP is World Bank Group’s flagship report that examines global economic developments and prospects with special focus on developing and emerging market economies. It is issued twice a year in January and June. The January edition includes in-depth analyses of topical policy challenges while June edition contains shorter analytical pieces.