IMF flags Super El Niño risks to India’s growth, says impact yet to materialise
According to the IMF, India continues to act as a significant growth engine within the global economy. Despite looming threats posed by weather phenomena like Super El Nino, these risks have yet to materialize. Recent adjustments have raised growth forecasts to 7 percent for the fiscal years 2027 and 2028, reflecting robust domestic demand and a thriving service sector.
The International Monetary Fund (IMF) has cautioned that the Super El Niño weather phenomenon could pose risks to India's economic growth, though such impacts have not yet manifested, according to an update on Thursday. The global lender will review its growth projections for India in January, contingent on the development of these weather-related risks, said IMF Communications Director Julie Kozack during a press conference.
Earlier forecasts by the IMF had increased India's growth outlook to 7% for both fiscal years 2027 and 2028, buoyed by strong domestic demand and robust services sector activity. Kozack highlighted that India remains a significant contributor to global economic expansion, emphasizing the uncertainties surrounding the potential effects of Super El Niño, which could include diminished agricultural output and elevated food prices.
These factors could erode the purchasing power of Indian households, but the IMF has not yet considered a realized impact on its growth projections, according to Kozack. The latest World Economic Outlook report, released in Bangkok, projected 7% growth for India in both fiscal years 2027 and 2028, driven by domestic demand and vigorous services sector activity.
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