India’s GDP growth is likely to moderate from 8.2 per cent in 2023 to 7 per cent in 2024 and 6.5 per cent in 2025 because the pent-up demand accumulated during Covid has exhausted, the International Monetary Fund (IMF) said on Tuesday.

About the global economy, the IMF said the battle against inflation has largely been won, even though price pressures persist in some countries.

After peaking at 9.4 per cent year-over-year in the third quarter of 2022, headline inflation rates are now projected to reach 3.5 per cent by the end of 2025, below the average level of 3.6 per cent between 2000 and 2019, it said.

The annual World Economic Outlook released here projected global economic growth to stay steady at 3.2 per cent in 2024 and 2025.

“In India, the outlook is for GDP growth to moderate from 8.2 per cent in 2023 to 7 per cent in 2024 and 6.5 per cent in 2025, because pent-up demand accumulated during the pandemic has been exhausted, as the economy reconnects with its potential,” the IMF said in the World Economic Outlook.

The latest Economic Survey said the GDP growth in 2024-25 is expected to moderate to 6.5-7 per cent from 8.2 per cent in 2023-24.

According to Pierre-Olivier Gourinchas, IMF chief economist, the global economy remained unusually resilient throughout the disinflationary process.

“Growth is projected to hold steady at 3.2 per cent in 2024 and 2025, but some low-income and developing economies have seen sizable downside growth revisions, often tied to intensifying conflicts,” he said.

PTI