Gita Gopinath also met Piyush Goyal and Amitabh Kant last week to discuss the Indian economy and ways to boost growth in the country in the current global scenario.

IMFs Gita Gopinath meets PM Modi amid declining growth discusses economyImage source: Twitter
Money IMF Tuesday, December 24, 2019 - 13:14

Economic Counsellor and Director of the Research Department at the International Monetary Fund (IMF), Gita Gopinath met PM Narendra Modi in Delhi on Monday.

The Prime Minister’s office posted a picture of PM Modi meeting Gopinath.

“Had a very productive discussion with PM Shri Narendra Modi on the global and Indian economy. Look forward to continuing engagement between IMF and Government of India,” Gopinath tweeted on Monday night.

Gopinath also met Railways and Commerce Minister Piyush Goyal and NITI Aayog CEO Amitabh Kant last week to discuss the Indian economy and ways to boost growth in the country in the current global scenario.

The meeting with Modi and other ministers also comes at a time when the IMF, in its report on the Indian economy, urged the government to take urgent policy actions to address the current prolonged downturn.

"The issue in India currently is the growth slowdown. We still believe it is mostly cyclical, not structural... because of the financial sector issues, we think, the recovery will be not as quickly quick as we thought earlier. That's the main issue," Ranil Salgado, Mission Chief for India in the IMF Asia and Pacific Department told PTI in an interview as it released its annual staff report on India.

On Friday, speaking at FICCI's 92nd Annual Convention, Gopinath said that the government should stick to its target of fiscal consolidation.

"For India, macro stability is very important, which means stability on the fiscal front... clear sense of keeping to the target of fiscal consolidation. Now that would require both increasing revenue mobilisation and also rationalising expenditure. So, these are some of the issues that need to be addressed," she said.

She also pointed out the need raise productivity in agriculture in the country which would eventually raise rural income.

She further disclosed that some high frequency indicators did not show an increase in India's growth during the third and fourth quarters as was anticipated earlier.

"Our expectation was that the first two quarters of fiscal 2019-20 would be a slowing scenario and then there would be an uptick in the third and fourth quarter. Looking at some of the high frequency indicators, we are not seeing the kind of uptick we were projecting, so this is why I mentioned that we will be revising the numbers again in January," she said.

She also attributed regulatory uncertainty in India as one of the reasons for the ongoing economic slowdown.

"I believe, in the slowdown, regulatory uncertainty has played a role. That's another factor that needs to be addressed. It's important for India to take up reforms but to be able to do this with greater clarity and greater certainty would help," she said.

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