Indian economy well-poised to face global headwinds, believes IMF’s Luis Breuer

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India looks poised well to face the global economic headwinds, says International Monetary Fund's Senior Resident Representative to India Luis Breuer.

"India is facing challenges, most of which come from the international economy, but we feel that the country is in a strong economic position and is very well poised to face these challenges,” Breuer said at an event in New Delhi on March 15.

The country’s structural reforms should continue as they can counter balance the headwinds that are coming from the international economy and help it grow faster, it added.

The IMF estimates India’s economy to grow 6.8 percent this fiscal year and 6.1 percent next fiscal.

“Balance sheets of corporates and banks have improved, credit has returned, inflation has stabilised. It is in the middle of a number of reforms, which we believe will lead to higher productivity gains, higher potential growth,” the IMF official said.

Terming the budget for the next financial year as prudent, Breur said that the fiscal consolidation will reduce and stabilise public debt “which is quite is high in India as compared to other countries”.

A clearly spelled-out medium-term fiscal plan that has ambitious fiscal targets and description of policies should be followed to reach those targets, Breuer suggested.

Commenting on monetary policy, he said that India’s central bank is doing the right thing with its tightening stance that is appropriate to promote sustainable, stable growth over many years.