India's Growth Spillover Unlikely Outside South Asia: IMF

India is the fastest growing economy, its impact is unlikely to be felt beyond South Asia, senior IMF officials said.

Published: 15th April 2016 02:49 PM  |   Last Updated: 15th April 2016 02:49 PM   |  A+A-


WASHINGTON: Even as India is now the fastest growing emerging economy in the world, its impact is unlikely to be felt beyond South Asia, senior International Monetary Fund (IMF) officials said on Friday and at the same time warned of the adverse consequences of China's economic downtown.

"India is obviously a major economy in its sub-region, in South Asia. We see the immediate neighbours benefiting a lot (from the Indian growth story)," Markus Rodlauer, Deputy Director, Asia and Pacific Department, of the International Monetary Fund told reporters during a news conference.

"Its actual economic ties with South East Asia and China are more limited so the direct spillover from the growth in India both on the trade side and on the financial side are limited to the rest of Asia," Rodlauer said when asked if the remarkable growth story of India would have an impact on the Asian economy.

India is the fastest growing emerging economy in the world, with growth rates at 7.5 per cent both in 2016-17, said Changyong Rhee, director Asia and Pacific Department, IMF.

"Activity is expected to continue to be underpinned by private consumption, which has benefited from lower energy," Rhee said as he warned that Asia faces continuing sizable spillovers from China.

China's transition can have adverse, albeit very heterogeneous, spillovers in the region, he said.

"Countries more exposed to consumption can be winners, while those more exposed to investment and manufacturing can lose in the near term. Through financial channels, China's spillovers are also on the rise, and much increased from the period before the global financial crisis," Rhee said.

China's slowdown also has affected global commodity demand, but here too the effect is heterogeneous, he noted.

"Asia of course is impacted by the still weak global recovery, and by the ongoing and necessary rebalancing in China," Rhee said.

Stay up to date on all the latest Business news with The New Indian Express App. Download now


Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on are those of the comment writers alone. They do not represent the views or opinions of or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp