IMF projects India's growth at 7.3 per cent in 2018, 7.4 per cent next year
Washington, Oct 9 : India is projected to grow at 7.3 per cent in 2018 and 7.4 per cent next year, the IMF said Tuesday, predicting that the country will regain the tag of the world's fastest growing major economy this year, surpassing China with more than 0.7 percentage points.
In 2017, India had clocked a 6.7 per cent growth rate.
In India, important reforms have been implemented in the recent years, including the Goods and Services Tax (GST), the inflation-targeting framework, the Insolvency and Bankruptcy Code, and steps to liberalise foreign investment and make it easier to do business, the International Monetary Fund (IMF) said in its latest World Economic Outlook (WEO) report.
"India's growth is expected to increase to 7.3 per cent in 2018 and 7.4 per cent in 2019 (slightly lower than in the April 2018 World Economic Outlook (WEO) for 2019, given the recent increase in oil prices and the tightening of global financial conditions), up from 6.7 per cent in 2017," it said in the WEO report.
This acceleration, the world body said, reflected a rebound from transitory shocks (the currency exchange initiative and implementation of the GST), with strengthening investment and robust private consumption.
India's medium-term growth prospects remain strong at 7 per cent, benefiting from the ongoing structural reforms, but have been marked down by just under a half percentage point relative to the April 2018 WEO, it said.
If projections are true, then India would regain the tag of the fastest growing major economy of the world, crossing China with more than 0.7 percentage points in 2018 and an impressive 1.2 percentage point growth lead in 2019.
China was the fastest growing economy in 2017 as it was ahead of India by 0.2 percentage points. For the record, the IMF has lowered the growth projections for both India and China by 0.4 per cent and 0.32 per cent, respectively, from its annual April's WEO.
Released in Bali during the annual meeting of the IMF and the World Bank, the IMF's flagship WEO said its 2019 growth projection for China is lower than in April, given the latest round of US tariffs on Chinese imports, as are its projections for India.
In China, growth is projected to moderate from 6.9 per cent in 2017 to 6.6 per cent in 2018 and 6.2 per cent in 2019, reflecting a slowing external demand growth and necessary financial regulatory tightening, the report said.
The 0.2 percentage point downgrade to the 2019 growth forecast is attributable to the negative effect of recent tariff actions, assumed to be partially offset by policy stimulus, it said.
Over the medium term, growth is expected to gradually slow to 5.6 per cent as the economy continues to make the transition to a more sustainable growth path with continued financial de-risking and environmental controls, it noted.
"Owing to these changes, our international growth projections for both this year and next are downgraded to 3.7 per cent, 0.2 percentage point below our last assessments and the same rate achieved in 2017," the report said.
The growth rate of the US for 2018 is 2.9 per cent and that of 2019 has been powered to 2.5 per cent.
"Looking ahead, renewed impetus to reform labour and land markets, along with further improvements to the business climate are also crucial (in India)," it said.
According to the WEO, in India, reform priorities include reviving bank credit and enhancing the efficiency of credit provision by accelerating the cleanup of bank and corporate balance sheets and improving the governance of public sector banks.
In India, a high interest burden and risks from rising yields require continued focus on debt reduction to establish policy credibility and build buffers.
"These efforts should be supported by further reductions in subsidies and enhanced compliance with the Goods and Services Tax," the IMF report said.
It also said inflation in India is on the rise, estimated at 3.6 per cent in fiscal year 2017/18 and projected at 4.7 per cent in fiscal year 2018/19, compared to 4.5 per cent in fiscal year 2016/17, amid accelerating demand and rising fuel prices.
The report said that aggregate growth in the emerging market and developing economy group stabilised in the first half of 2018.
Emerging Asia continued to register strong growth, supported by a domestic demand-led pickup in the Indian economy from a four-year-low pace of expansion in 2017, even as activity in China moderated in the second quarter in response to regulatory tightening of the property sector and nonbank financial intermediation, it added.
Let the Truth be known. If you read VB and like VB, please be a VB Supporter and Help us deliver the Truth to one and all.
Netanyahu recommends his Cabinet approve Hezbollah cease-fire proposal
Beirut, Nov 26: Israeli Prime Minister Benjamin Netanyahu said Tuesday that he would recommend his cabinet adopt a United States-brokered ceasefire agreement with Lebanon's Hezbollah, as Israeli warplanes struck across Lebanon, killing at least 23 people.
The Israeli military also issued a flurry of evacuation warnings — a sign it was aiming to inflict punishment on Hezbollah down to the final moments before any ceasefire takes hold. For the first time in the conflict, Israeli ground troops reached parts of Lebanon's Litani River, a focal point of the emerging deal.
In a televised statement, Netanyahu said he would present the ceasefire to Cabinet ministers later on Tuesday, setting the stage for an end to nearly 14 months of fighting.
Netanyahu said the vote was expected later Tuesday. It was not immediately clear when the ceasefire would go into effect, and the exact terms of the deal were not released. The deal does not affect Israel's war against Hamas in Gaza, which shows no signs of ending.
The evacuation warnings covered many areas, including parts of Beirut that previously have not been targeted. The warnings, coupled with fear that Israel was ratcheting up attacks before a ceasefire, sent residents fleeing. Traffic was gridlocked, and some cars had mattresses tied to them. Dozens of people, some wearing their pajamas, gathered in a central square, huddling under blankets or standing around fires as Israeli drones buzzed loudly overhead.
Hezbollah, meanwhile, kept up its rocket fire, triggering air raid sirens across northern Israel.
Lebanese officials have said Hezbollah also supports the deal. If approved by all sides, the deal would be a major step toward ending the Israel-Hezbollah war that has inflamed tensions across the region and raised fears of an even wider conflict between Israel and Hezbollah's patron, Iran.
The deal calls for a two-month initial halt in fighting and would require Hezbollah to end its armed presence in a broad swath of southern Lebanon, while Israeli troops would return to their side of the border. Thousands of Lebanese troops and UN peacekeepers would deploy in the south, and an international panel headed by the United States would monitor all sides' compliance.
But implementation remains a major question mark. Israel has demanded the right to act should Hezbollah violate its obligations. Lebanese officials have rejected writing that into the proposal. Israel's Defense Minister Israel Katz insisted on Tuesday that the military would strike Hezbollah if the U.N. peacekeeping force, known as UNIFIL, doesn't provide “effective enforcement” of the deal.
“If you don't act, we will act, and with great force,” Katz said, speaking with UN special envoy Jeanine Hennis-Plasschaert.
The European Union's top diplomat, Josep Borrell, said Tuesday that Israel's security concerns had been addressed in the deal also brokered by France.
“There is not an excuse for not implementing a ceasefire. Otherwise, Lebanon will fall apart,” Borrell told reporters in Italy on the sidelines of a Group of Seven meeting. He said France would participate on the ceasefire implementation committee at Lebanon's request.
Bombardment of Beirut's southern suburbs continues
Even as Israeli, US, Lebanese and international officials have expressed growing optimism over a ceasefire, Israel has continued its campaign in Lebanon, which it says aims to cripple Hezbollah's military capabilities.
An Israeli strike on Tuesday levelled a residential building in the central Beirut district of Basta — the second time in recent days warplanes have hit the crowded area near the city's downtown. At least seven people were killed and 37 wounded, according to Lebanon's Health Ministry.
Three people were killed in a separate strike in Beirut and three in a strike on a Palestinian refugee camp in southern Lebanon. Lebanese state media said another 10 people were killed in the eastern Baalbek province. Israel says it targets Hezbollah fighters and their infrastructure.
Earlier, Israeli jets struck at least six buildings in Beirut's southern suburbs. One strike slammed near the country's only airport, sending plumes of smoke into the sky. The airport has continued to function despite its location on the Mediterranean coast next to the densely populated suburbs where many of Hezbollah's operations are based.
Israeli military spokesman Avichay Adraee issued evacuation warnings for 20 buildings in the suburbs, as well as a warning for the southern town of Naqoura where UNIFIL is headquartered.
UNIFIL spokesperson Andrea Tenenti told The Associated Press that peacekeepers will not evacuate.
Other strikes hit in the southern city of Tyre, where the Israeli military said it killed a local Hezbollah commander.
The Israeli military also said its ground troops clashed with Hezbollah forces and destroyed rocket launchers in the Slouqi area on the eastern end of the Litani River, a few kilometres from the Israeli border.
Previous ceasefire hopes were dashed
Under the ceasefire deal, Hezbollah would be required to move its forces north of the Litani, which in some places is about 30 kilometers (20 miles) north of the border.
A ceasefire between Israel and Hezbollah, the strongest Iranian-backed force in the region, would likely significantly calm regional tensions that have led to fears of a direct, all-out war between Israel and Iran. It's not clear how the ceasefire will affect the Israel-Hamas war in Gaza. Hezbollah had long insisted that it would not agree to a ceasefire until the war in Gaza ends, but it dropped that condition.
Hezbollah began firing into northern Israel, saying it was showing support for the Palestinians, a day after Hamas carried out its Oct. 7, 2023, attack on southern Israel, triggering the Gaza war. Israel returned fire on Hezbollah, and the two sides have been exchanging barrages ever since.
Israel escalated its campaign of bombardment in mid-September and later sent troops into Lebanon, vowing to put an end to Hezbollah fire so tens of thousands of evacuated Israelis could return to their homes.
More than 3,760 people have been killed by Israeli fire in Lebanon the past 13 months, many of them civilians, according to Lebanese health officials. The bombardment has driven 1.2 million people from their homes. Israel says it has killed more than 2,000 Hezbollah members.
Hezbollah fire has forced some 50,000 Israelis to evacuate in the country's north, and its rockets have reached as far south in Israel as Tel Aviv. At least 75 people have been killed, more than half of them civilians. More than 50 Israeli soldiers have died in the ground offensive in Lebanon.
After previous hopes for a ceasefire were dashed, U.S. officials cautioned that negotiations were not yet complete and noted there could be last-minute hitches that delay or destroy an agreement.
“Nothing is done until everything is done,” White House national security spokesman John Kirby said.
While the ceasefire proposal is expected to be approved if Netanyahu brings it to a vote in his security Cabinet, one hard-line member, National Security Minister Itamar Ben-Gvir, said he would oppose it. He said on X that a deal with Lebanon would be a “big mistake” and a “missed historic opportunity to eradicate Hezbollah.”
