Why Germany thinks India is a ‘huge opportunity’ to invest
New Delhi: After the strongly emerging sentiment that India could emerge as the World’s savior in the most likely scenario of an impending slowdown of all the major economies across the globe—Europe and the US expected to be worst hit—after the International Monetary Fund (IMF) released its growth projections, Germany has come forward to actually acknowledge it.
Speaking on the IMF’s growth projection for India, German Ambassador Dr Philipp Ackermann Thursday said, “We’re very impressed with the latest figures India has put on the table. It’s one of the best-growing countries in the region if not worldwide. Therefore, it gives us huge opportunity to invest in India. And not just us, but any business in Germany.”
Even the government of India, while acknowledging that even India’s growth rate was recently downgraded, is confident that India’s growth will not see the kind of meltdown the West has already started to witness.
Finance Minister Nirmala Sitharaman, who is in the US to attend the annual meetings of the IMF and World Bank, on Tuesday had said that despite the downgrading of the growth forecast for India, she was confident that the Indian economy would grow at around 7 per cent in 2022-23.
“I am aware that growth forecasts around the world are being revised lower. We expect India’s growth rate to be around 7 per cent this financial year. More importantly, I am confident of India’s relative and absolute growth performance in the rest of the decade,” she said addressing a gathering in Washington.
Earlier, IMF had predicted India’s GDP growth to be around 6.8 per cent, down from the previous projection of over 8 per cent. But, despite the downgrade, India still remains one of the fastest-growing economies in the world.
How India stacks up against US, Europe, China?
The German confidence in India being a lucrative investment option stems from the IMF report that puts India, in terms of rate of growth, ahead of the US, China, Germany, Japan and the UK, among other major economies of the world.
According to the IMF, While India is expected to see a growth of 6.8 percent in this fiscal, in 2023 it is expected to grow at 6.1 per cent. Against this, the US is expected to grow at 1.6 per cent this year and at 1 per cent next fiscal. Similarly, Euro Area is projected to grow at 3.1 per cent this year and at 0.5 per cent next year in 2023.
The UK is expected to grow at 3.6 per cent this year, but at a sluggish rate of just 0.3 per cent in 2023. Germany is expected to grow at 1.5 per cent this year, but IMF has predicted a contraction in its economy, expected to grow at -0.3 per cent.
What India did right?
FM Sitharaman also emphasised all that India did right to reach this level of immunity from the vagaries of global economy hit hard successively by, first the Covid29 pandemic, and then by the Ukraine-Russia War that broke out in February this year.
“We addressed these multiple and complex challenges through a variety of interventions. One, India ramped up its vaccine production and vaccination. India has administered over 2 billion doses of vaccine produced domestically. Two, India’s digital infrastructure ensured the delivery of targeted relief Third, in 2022, after the conflict erupted in Europe, we ensured adequate availability of food and fuel domestically, lowered import duties on edible oil and cut excise duties on petrol and diesel. The central bank has acted swiftly to ensure that inflation did not get out of hand and that currency depreciation was neither rapid nor significant enough to lead to a loss of confidence,” the minister said.
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