Hardly anything to derail India's growth: IMF

WASHINGTON: There is hardly anything to derail the economic progress of India, as the underlying fundamentals of growth will not come off even if managing bumps along the way turns out to be challenging, a senior official of the International Monetary Fu nd said. "To my mind, it is hard to see something that is significantly going to derail the progress. There are going to be bumps along the road and managing those bumps are going to be quite challenging," said Ms Kalpana Kochhar the Senior Advisor in the Asia an d Pacific Department of the Fund. But the underlying fundamental growth story has been based on productivity, investments needs and the private sector and I don't see that coming off, Ms Kochhar reasoned. "It would not be unreasonable to assume that some of the credit market turmoil would spill over into India. Investment is the big story... that has been the one driving growth in the last couple of years and we need to continue that," Ms Kochhar said. "You could say that if there is a big crunch on the credit markets, India could be affected. But, you have to keep in mind that the banks' liquidity in India is still pretty high, and credit growth, although having come off, is still growing at 25 per ce nt," she added. The senior IMF official on the eve of the Spring Meetings of the Bank and the World Bank argued that India's "very important" endorsement of the reforms on Quota Voice has been a very major step forward. "India has benefited from some of the changes... that have been put in place but it is also a very important demonstration that developing countries have brought into this effort to broaden representation of the fund," Ms Kochhar said. [From Internet]