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IMF cuts India's growth rate following demonetisation stress

by IBNS 17 Jan 2017, 07:14 am

Washington, Jan 17 (IBNS): In a setback for the Indian government, the International Monetary Fund (IMF) has cut India's growth rate to 6.6 percent for the current fiscal year, a decrease by one percent from its previous estimate.

The decrease in percentage is a result of the post demonetisation stress.

"In India, the growth forecast for the current (2016–17) and next fiscal year were trimmed by one percentage point and 0.4 percentage point, respectively, primarily due to the temporary negative consumption shock induced by cash shortages and payment disruptions associated with the recent currency note withdrawal and exchange initiative," the IMF release stated.

However, the projections for India in 2017 and 2018 stands at 7.2 and 7.7 per cent respectively.