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India still a bright spot: IMF

With strong growth and rising real income, India remains a bright spot in the global economy, IMF chief Christine Lagarde said.

With strong growth and rising real income, India remains a bright spot in the global economy, IMF chief Christine Lagarde said. In her major policy address, Ms Lagarde said overall, the global outlook has weakened further over the last six months exacerbated by China’s relative slowdown, lower commodity prices and the prospect of financial tightening for many countries.

Emerging markets had largely driven the recovery and the expectation was that the advanced economies would pick up the “growth baton”. “That has not happened,” the IMF MD said in her address ‘Decisive action to secure durable growth’ at Goethe University, Frankfurt in Germany.

While emerging markets are a very diverse group, the story is broadly similar. China’s transition to a more sustainable economic model which is good for China and the world means that its growth rate, while still strong, is lower. Downturns in Brazil and Russia are larger than expected, she said. “India, by contrast, remains a bright spot with strong growth and rising real incomes,” she said.

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