India’s Recent Macroeconomic Performance: An Assessment and Way Forward

Author/Editor: Muneesh Kapur ; Rakesh Mohan
Publication Date: April 29, 2014
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Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
Summary: The macroeconomic policy response in India after the North Atlantic financial crisis (NAFC) was rapid. The overshooting of the stimulus and its gradual withdrawal sowed seeds for inflationary and BoP pressures and growth slowdown, then exacerbated by domestic policy bottlenecks and volatility in international financial markets during mid-2013. Appropriate domestic oil prices and fiscal consolidation will contribute to the recovery of private sector investment. Fiscal consolidation would also facilitate a reduction in inflation, which would moderate gold imports and favorably impact real exchange rate and current account deficit.
Series: Working Paper No. 14/68
Subject(s): Economic growth | India | Monetary policy | Exchange rates | Exports | Imports | Fiscal policy | Current account deficits | Fiscal consolidation

Publication Date: April 29, 2014
ISBN/ISSN: 9781484360675/1018-5941 Format: Paper
Stock No: WPIEA2014068 Pages: 66
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